German battery maker Varta files insolvency applications

ggiuliomagnifico about 2 hours ago 46 commentsRead Article on reuters.com

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Discussion (46 Comments)Read Original on HackerNews

meangenehackman•about 1 hour ago

FTA - They lost Apple as their main customer. Apple is switching to Chinese battery manufactures.

petcat•about 1 hour ago

> Varta lost its key customer in the spring: Apple plans to source the rechargeable "CoinPower" button cells for its AirPods headphones from China in the future.

It's another tough loss for German and European industry. Battery tech requires a lot of electricity and German energy prices are simply not competitive. And EU regulations limit how much the German government can subsidize industrial electricity costs.

Lots of debt, expensive labor, expensive energy, and EU Battery Regulation and limits on subsidies all adds up to just losing the business completely to China.

gbil•about 1 hour ago

You forgot the new US tarrif because of "forced labor"! At least in China things are much better on labor side!

Sorry couldn't resist....

philipwhiuk•about 1 hour ago

The assumption that Europeans can just absorb high energy prices is crazy. Ought to be a national imperative to invest in infrastructure to lower prices.

p-e-w•about 1 hour ago

Lol. Depending on the country and who the buyer is, 50-80% of energy prices are taxes and levies. Those prices have nothing to do with missing infrastructure.

thyristan•about 1 hour ago

The problem there is the "national imperative" part imho. All EU politicians are hell-bent on ignoring any kind of market-based solutions, doing everything through regulations and picking winners. So there will never be a proper market equilibrium and therefore prices will always be higher than in places without all those regulatory interventions.

Investment won't help there in any way, because if that investment were worth it, it would already happen because of market forces. If it doesn't happen on its own, then the state (doesn't matter which level) has to do it, which means using tax money, which means that prices will rise. So that state investment will further skew the market equilibrium, putting the EU further behind.

jojomodding•about 1 hour ago

I am not sure I understand what you are trying to say. There is currently a lot of demand for building out solar and wind in Germany. There is also large demand for building battery storage. The demand especially for the latter comes from the mismatch between supply and demand in electricity markets, so in a sense the battery operators hope to do arbitrage in a way that will also increase the efficiency of the market (by allowing the use of solar after dark).

This is very much a market-based solution. What the state has to do is provide permits and stuff for getting the batteries etc. actually built; which the state is doing but not as fast as it could right now. (at least in Germany)

sajithdilshan•about 1 hour ago

Also all the regulations are based on hardcore ideologies. EU truly wants to be carbon neutral and that is applaudable, but at what cost is the question. Does is make sense to decimate most of the energy heavy industries in the continent to be carbon neutral? I guess only time will tell.

sajithdilshan•about 1 hour ago

I think it's a self made crisis. They turned off their atomic power plants in the middle of an energy crisis (even the current German government admitted that it was a mistake: https://clashreport.com/world/articles/germanys-merz-admits-...) and now importing far expensive natural gas from middle east and USA

TheChaplain•about 1 hour ago

It's not that bad, they still make money on consumer- and micro batteries. Needs a bit of restructuring.

InsideOutSanta•about 1 hour ago

Yeah, they make some of the best low-self-discharge rechargeables. All of my AA and AAAs are Varta. They're extremely prominent in lots of stores in Europe. When I read the headline, I was like, "But how?" but the Apple angle makes sense.

mertbio•about 1 hour ago

The sentiment seems to be that this is unique to Germany but is there any country that can rival China in manufacturing?

ShinyLeftPad•about 1 hour ago

Many can, they just choose not to go. They balance the economy instead of going all in on manufacturing and export. They don't suppress domestic consumption, have strong labor protection laws etc.

lnsru•39 minutes ago

Let me rephrase you: “many could…“. Because if you don’t manufacture continuously you loose knowledge. It’s more than buying machinery and hiring labor. Manufacturing is continuous improvement process. Improving raw materials, manufacturing parameters, testing technology. When one stops it it’s game over.

Incipient•about 1 hour ago

Varta has moved (outsourced?) pretty much all consumer batteries we get in Australia to China.

sleepyguy•about 1 hour ago

> is there any country that can rival China in "Government subsidized" manufacturing?

FIFY

mr_toad•41 minutes ago

It’s not just government money. Factory workers wages in China are still a lot lower than western countries, and they have a lot fewer labor rights.

Also, the government hinders as often as it helps, since they can always take over an industry or make it’s CEO disappear if they feel like it.

dmix•about 1 hour ago

Definitely not the ones who spent the last two decades being anti-growth and high cost just to suddenly realize they do need to have their own domestic businesses.

gib444•about 1 hour ago

If this were a US company with better PR, I wonder if it would have read more like:

"Varta Boldy Undertakes Strategic Restructuring to Unlock Value and Sharpen Business Focus"

Towaway69•30 minutes ago

Much like OpenAI yesterday: “our safety container for model testing failed completely… we have to ban open weight models so that we can corner the market” - win-win for everyone, especially openAI

mproud•about 1 hour ago

Apple giveth, Apple taketh away.

selimthegrim•about 1 hour ago

Who's the Andy and who's the Bill in Apple now?

Apreche•about 1 hour ago

I only encountered this brand when trying to buy batteries for old cameras. It would be a shame if some of those less common varieties were no longer available.

tecleandor•about 1 hour ago

I find it regularly when buying car batteries (the regular 12V ones), and in fact I bought one for a friend just a couple weeks ago.

They're kinda popular at least around Europe.

edit: I just remembered when I worked on TV production some years ago, and they bought big boxes of the "Industrial" variety of AA cells for the wireless mics and in ears.

m00dy•about 1 hour ago

so sad to see Germany's fall right in front of our eyes.

sajithdilshan•about 1 hour ago

As the brits would say, write off Germans at your own peril. They survived two world wars and still became the biggest economy in Europe, so time would tell if they would be able to turn the tide around for a 3rd time

lnsru•34 minutes ago

Americans turned the tide with Marshall plan second time. There will be no third time. Germany gutted itself with: a) very inefficient federal administration system; b) insanely inefficient social system and c) uncontrolled immigration and d) writing laws accordingly car lobby group requirements. Car makers are dead. Well paid jobs gone. e) tragic demographics.

Towaway69•25 minutes ago

Indeed, plus miles behind in tech and seemingly doing everything to maintain that.

Although the government will invest in “startups” which meant that one defence (probably drones) related startup gets 500M euros - eggs and baskets comes to mind.

Germany is in invest in defence and conscript the young mode currently. We know where that will lead.

icantevenhold•36 minutes ago

Fall from what exactly?

As someone living here it’s still one of the most carefree and comfy countries I’ve lived in.

lovegrenoble•about 1 hour ago

Rip German industry. Gerhard Schroeder was a good Chancellor.

Tade0•about 1 hour ago

Schroeder lobbied for Germany to remain dependent on Russian gas. Huge net negative in the long run.

usrnm•about 1 hour ago

Genuinely curious, what alternatives were there in the 2000s? Did dependency on Russian gas doom German manufacturing or did it provide it 20 additional years of artificial life support?

thyristan•about 1 hour ago

Nuclear. The Schroeder government initiated the German nuclear phase-out (which was later reverted and re-reverted by Merkel). But rumor has it that the nuclear phase-out wasn't only motivated by the greens being anti-nuke, but also by Schroeder being interested in pushing gas instead.

Btw., after his chancellorship, Schroeder got a post at the Russian state gas supplier Gazprom.

mft_•about 1 hour ago

His direct involvement with the Russian oil and gas sector (and, most likely, influence on their behalf) is a lot more recent than just 'the 2000s' [0][1].

[0] https://www.cleanenergywire.org/news/ex-german-chancellor-sc...

[1] https://de.wikipedia.org/wiki/Gerhard_Schr%C3%B6der#Rosneft

Tade0•39 minutes ago

Diversifying just a little bit would go a long way.

When Russia invaded Ukraine suddenly several LNG terminals gained regulatory approval, even though previously those projects were in bureaucratic purgatory for years.

iamflimflam1•39 minutes ago

The alternative was to aggressively pursue nuclear power.

Towaway69•21 minutes ago

In the context of the times it was the aim of Europe to integrate Russia into the EU zone.

Who gave Russia all that money to convert to capitalism after the fall of the wall? The US. Who wanted Russia to become a capitalistic nation? The west.

That it failed is in whose interest? And who is scared of Chinese influence? And who outsourced all their manufacturing to China?

Sometimes context does matter.

ErneX•about 1 hour ago

My guess is OP was being sarcastic.

jojomodding•about 1 hour ago

You can never know. People in Germany have wildly divergent takes on what would be good for the country right now and some things that are acceptable to say in mainstream circles seem batshit insane to me.

dachworker•about 1 hour ago

At the time it was a perfectly rational decision that followed the liberal foreign policy dogma of the time, which advocated that we tie up unstable countries with economic trade, so they become less incentivized to create havoc. Let's please not rewrite history.

tyromaniac•31 minutes ago

*Giving "unstable" countries leverage over your economic trade

FIFY