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Comment by maxdo | Hacker News Reader

German cars have lost their technological edge. They can't even build their own infotainment systems anymore. They're paying billions to China to do it for them.

I can't overstate how catastrophically stupid this is. Paying what they consider smaller competitors real cash to build core software, instead of developing that capability in-house or acquiring a few startups with decent engineering talent.

This isn't just a bad decision. It reveals a completely dysfunctional decision-making process and a total absence of technical ambition.

People who say but "Porche/Mercedes/etc.." has this design. Luxury segment is not coming from nowhere. This is the same reason british luxury cars are gone essentially. It will take some time, but EU built cars will be in a constant decline.

What's even more fun, they don't want to protect their own market the same way chinese did.

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> instead of developing that capability in-house or acquiring a few startups with decent engineering talent.

VW has a JV with Rivian. I'd consider that to be similar to what you suggest.

https://rivianvw.tech/

Rivian will not be involved in infotainment for the most part

> instead of developing that capability in-house or acquiring a few startups with decent engineering talent.

It's usually the former and their infotainment stuff is usually nothing to get excited about. When they buy startups they get bogged down and burn off the talent quickly.

Maybe the solution is not having the same small set of car companies trying to pull off the survival balancing act as we did a century ago, maybe that's why China is progressing quicker.

Their biggest brand, BYD, is also relatively the "oldest."

It's the governemt priorities, local gov in China is building EV companies, AI companies. EU governemnt, US local gov is building shelters, or people who kick out people from a shelter on a voters mood swing.

A friend from the EU visited recently. He said, "At least the Netherlands is doing much better than 10 years ago...we have lights, roads." That one sentence captures the entire mindset gap.

The bitter irony: Philips literally built ASML and TSMC, then sold both. Now those companies dominate global semiconductor supply chains while Philips sells... healthcare equipment at a loss.

And ASML is about to lose it's dominance too.

But yeah...lights on the streets. Built with Chinese LEDs. Powered by Chinese solar panels. Bought using budget deficits. In debt.

And the deficit keeps growing. Some EU countries faster, some slower. But the trend is unmistakable.

Amen. This is some of the best descriptions of the current mid to upper class mentality in Europe. Frankly, I think only the common man feels what is really happening here.

To close the loop, the debt is treasury bonds held by other countries?

can you expand on ASML losing its dominance? i have not heard that

It hasn't happened yet. However China has demonstrated they can make the same thing now and just need some improvements. Time will tell but it isn't looking good for them long term.

My homecountry the Netherlands is the worst. The push for becoming 'small America' had us sell of everything we could possibly be proud off to other countries, including the US (mostly Blackrock and Vanguard) and India and China. Privatize everything because it works so well in the US, sell it all (private and public) off to the highest bidder and hope for globalization and the market. NL is doing well economy wise still, but I wonder how much better we could've done if we kept it all to grow.

I studied math at the University of Eindhoven which, at the time, basically meant you would work at Philips or one of its companies. I did not and in hindsight I don't think I could've handled the downfall of that company up close.

That generation is the worst across Europe. They sold out entire industries, bought up all the land, let in millions of immigrants. Then they demanded to be kept alive during COVID, leading to massive overspending and health care premiums rising.

In return, they raised rents and health care premiums are still rising. And they are the last generation with massive egos (early boomer and before).

The US didn't privatize everything: it was largely private to begin with. The US had a near laissez-faire economy until the WW1-WW2 era. The 1850 to 1910 era is incredibly devoid of government regulations on the economy, which was of course undergoing a gigantic industrial expansion. European states were not formed in any manner similar to the US. The modern European nation was largely constructed in the post WW1 and post WW2 environment, they were heavily remade by the wars and what came after, including their social welfare structures and their various private/public ownership models. If you go back and look at the governing structures of most any of the European powers prior to WW2, they were nearly all: kingdoms or fascist. The US is floating on centuries of continually accumulating cruft, whereas most of the European nations have had hard break points where they reset the board and started fresh.

> The US didn't privatize everything

I did not mean that; i meant NL thought all privatised would be better looking at the US so they did (mostly). So they took the US as blueprint rather than repeat their steps.

I didn’t think Harmon Kardon was Chinese?

> They can't even build their own infotainment systems anymore. [...] I can't overstate how catastrophically stupid this is

Car manufacturers have for a very long time acted mostly as integrators and outsourced a vast amount of components, from braking systems to windows, lights, gearboxes alternators starters and other engine parts, electronic harnesses, suspension systems, seats, buttons and others. Lots of conglomerates nowadays even use common frames and engines ("platforms") across brands, developing engines is so expensive that they're sometimes shared across brands that aren't even part of the same groups. Infotainment and electronics are practically never built in-house, but instead purchased from Bosch, Samsung and the likes.

This makes sense, this isn't their specialty, the core market of vehicle buyers buy it for the car, not the infotainment system. Especially when talking about German cars, what they specialize into is the actual power train and quality of assembly. Not the radio.

My friend let me introduce you to the powerhouse of most european cars for 5 decades: Bosch.

it's not new. companies assemble tech, not build it.

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