This week a Chinese space probe called Chang’e-4 became the first to land on the far side of the moon. Also in the news, Huawei became the second-largest smartphone manufacturer in the world, overtaking Apple. And online retailer Alibaba is planning a global expansion and developing its operations in Europe. In the strictest terms, the three news items don’t have all that much in common. But they do share an origin: China.
This should give pause to anyone who had hoped Xi Jinping, China's president, was just spouting hot air when he recently promised that his country would lead the world in technology. Politicians and businesses in China don’t just talk the talk, they walk the walk. In a number of cutting-edge technologies, China is now at the forefront.
Wake up, Europe! Our continent is in danger of losing access to world-beating technologies. Sure, other topics are important, too, and we should debate them: Hw to secure Europe’s external borders, how to resettle refugees among member states, and how to fix the euro. But these are minor issues compared to the global contest to develop the technology of the future.
Those nations that want to secure the jobs of the 21st century need to be at the cutting edge of artificial intelligence, autonomous vehicles, sensors and robotics. But when it comes to all that, Germany and, in fact, all of Europe, is sadly lacking.
Despite all the political speeches and promises here in Germany, hardly anything has come of them. A lack of network coverage for smartphones is still part of daily life for most Germans, even though they live in the fourth-largest economy in the world. So is the tardy development of faster Internet networks. German Chancellor Angela Merkel can talk about Germany becoming a world leader in high tech as much as she likes – under these conditions, it is simply not possible.
The recent shifts in the international mobile-phone market can be seen as a warning to both politicians and businesses here. In a few short years, Chinese smartphone manufacturer Huawei has managed to overtake US giant, Apple. This achievement was possible because of more than just cheaper phones. It was also due to technological improvements. Now the biggest power players in the mobile phone market are trading places, probably for good. After the fall in iPhone sales this Christmas, it is unlikely that Apple will be able to reclaim its market share from Huawei.
There are plenty of other sectors that could suffer the same fate. In Germany, the auto industry stands to lose the most. Volkswagen chief Herbert Diess thinks there is only a 50:50 chance that German car makers will still be at the forefront of the sector in a decade. That concern is not an exaggeration. No, it is a realistic description of the current state of affairs in that industry.
German carmakers – the most important industry in the country by numbers employed – have lost touch with the most important technologies of the future: electric vehicles and self-driving cars. They have a long way to go before they catch up.
The fact that Google's Waymo was recently given official permission to start testing self-driving cars in ordinary traffic is proof. Germany is still a long ways away from such a step. There are certain stretches of the German highway where self-driving vehicles can be tested. But the capabilities required to allow them to roam city traffic are far more complex. The same is true for the development and production of battery cells suitable for the e-car age.
Europe is hardly at the front here. It is Asia, and above all China, making the most headway. The lag is so pronounced that CATL, a Chinese company, will be building a battery factory in Germany. Why not a German company? It’s an ongoing mystery why German car firms didn’t think a little earlier of working on e-car batteries that could go longer distances or perform better.
At the moment the results of that mismanagement are not yet reflected in sales figures. In terms of cars sold, BMW, Daimler and Volkswagen are still doing well – despite various problems with diesel engines. But it won’t stay that way for long, if the promised progress in e-mobility and autonomous driving doesn’t happen.
Another frustrating area is artificial intelligence, or AI. The German government wants to invest €3 billion into this area by 2025. But that’s just a drop in the bucket. And to this day, nobody has explained which area of AI the country wants to specialize in. The same problem prevails in the rest of Europe. The niche we supposedly want to become world leaders in has not yet been defined.
Europe must wake up, if we want to stay at the top technologically. If we don’t, we risk becoming what many Chinese people already consider us to be: A museum for outdated technology.
Sven Afhüppe is Handelsblatt's editor-in-chief. To contact the author: [email protected]