What does the rise of new entries (Tesla, Borgward, NIO, etc.) mean for legacy auto manufacturers in Germany and Europe?

Hi Aaron, both new entries and incumbents face numerous challenges these days. While new entries can benefit from the typical green field benefits (e.g., very slim, state of the art structures along the value chain, no technological legacy), they typically have issues with reaching required scale, product quality and especially customer proximity along the product lifecycle

Incumbents typically have the opposite strengths and weaknesses, but the advantage of having a broad customer base and consumer trust in a product where trust pays a key role

Personally, I do believe that both incumbents and new entries will play a role in the future due to the new mobility landscape, its underlying products and services and changing customer behaviour

That is very interesting and also makes sense. Thank you for your answer! Do Chinese-backed companies (like Borgward or NIO) stand a better chance than others in that they come with significant financial and potentially rich supply chain resources?

They do have a massive advantage on several dimensions that are very similar to when automotive became large in Germany c.100 years ago (e.g., low cost structures, great tech, large customer base in home market). Also, they have a lot of funds to grow quickly. I assume they will play a key role in the future

Very interesting, thank you for your answers!