How bad is the crisis at Volkswagen?

Attributing the crisis primarily to costs in Germany is too simplistic, the Frankfurter Rundschau explains:

“German manufacturers reacted far too late to the technological paradigm shift. For too long they made a fortune from large and expensive internal combustion engines. Meanwhile, Chinese companies were building up expertise in electric motors, batteries and software. … Now Chinese manufacturers are flooding Europe with technically sound and often cheaper electric cars. This is also the consequence of German companies failing to do their homework. … The car industry can overcome this crisis but it will never again enjoy the dominant position of previous decades. China has become too strong for that.”