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Volkswagen to launch one new electric car every month globally from next year

The company says 16 locations would produce battery-powered vehicles by 2022, up from just three currently.

Volkswagen to launch one new electric car every month globally from next year

Volkswagen to launch one new electric car every month globally from next year

Europe's largest automobile manufacturer Volkswagen Group on Tuesday said it was rapidly expanding its capacity to produce battery-powered vehicles and would equip 16 locations across the globe to do that by 2022. Currently, VW produces battery operated vehicles in just three of its factories and in just two years another nine factory locations would be equipped for this purpose. 

These plans are part of VW Roadmap E that was launched last year. The company had said it would build upto three million electric vehicles annually by 2025 and market 80 new models across its group of nine companies. This year, another nine new vehicles, three of which will be purely electric-powered, will be added to the Group's electric portfolio of eight e-cars and plug-in hybrids.

"From 2019, there will be a new electric vehicle virtually every month", said Matthias Muller, CEO of Volkswagen AG. "This is how we intend to offer the largest fleet of electric vehicles in the world, across all brands and regions, in just a few years."

To ensure adequate battery capacity for this massive expansion, the company has already agreed to partnerships with battery manufacturers for Europe and China and has awarded contracts for a total volume of around EUR 20 billion. A decision on the supplier for North America will be taken shortly.

"Over the last few months, we have pulled out all the stops to implement 'Roadmap E' with the necessary speed and determination," Muller added.

Experts see VW's repeated emphasis on this front as a means of getting rid of the stigma of "dieselgate" of 2015 that has continually haunted the firm. The dieselgate scandal had erupted in September 2015 when the US Environmental Protection Agency found VW had installed devices on its diesel turbocharged direct injection (TDI) engines that manipulated emissions during government tests. About 500,000 diesel vehicles with "defeat" devices were sold between 2009 and 2015 in the US and another 11 million worldwide. VW had to subsequently spend USD 29.7 billion to fix consumer-owned vehicles, plus pay a USD 2.8 billion fine to settle US criminal charges. Yet, Muller said electrification does not mean the firm is moving away completely from conventional technologies.

"We are making massive investments in the mobility of tomorrow, but without neglecting current technologies and vehicles that will continue to play an important role for decades to come," said Muller. "We are putting almost EUR 20 billion into our conventional vehicle and drive portfolio in 2018, with a total of more than EUR 90 billion scheduled over the next five years."

The group's has weathered the dieselgate storm well financially in spite of the billions in cash outflows due to the scandal.

"At EUR 230.7 billion, the group's sales revenue was up 6.2 percent on the prior-year figure, which was a new record," said CFO Frank Witter. "Operating profit before and after special items was also better than ever, amounting to EUR 17.0 billion before special items and to EUR 13.8 billion after special items. Even after deducting special items, this is the best operating profit that the Volkswagen Group has ever achieved."

The group's net liquidity at the end of 2017 remained at EUR 22.4 billion even as overall operating profit was reduced by special items from the diesel issue of EUR 3.2 billion in 2017 compared with EUR 6.4 billion in the previous year. These expenses in the 2017 fiscal year were mainly attributable to higher expenses for the buy-back and retrofitting programmes for 2.0 l and 3.0 l TDI vehicles in North America and to higher legal risks.

 

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