Volkswagen working on its Transform 2025+ strategy has announced that it will invest more than EUR 34 billion on future technologies like electric mobility, autonomous driving, new mobility services and digitalization over the coming years.
Most of this will go into the electrification and hybridization of all Group models. This marks another significant step up in Volkswagen’s commitment to this environment-friendly drive technology and a move to advance the Roadmap E electrification offensive at full speed. When the offensive was announced in September, the Group said it would electrify its entire model portfolio by 2030.
The company focussing on e-mobility and modularization will invest €22.8 billion in the future viability of its plants throughout the world. The company will invest about €14 billion to be invested in German plants to transform them into the e-mobility facility. In 2020, the Volkswagen I.D., the first vehicle in the new generation of electric automobiles will be launched on the market.
On the occasion of the announcement CEO, Matthias Müller said “We are reinventing the car. To achieve that, we are making targeted investments to provide the necessary funds from our own resources.”
Volkswagen is working on a strategy- Transform 2025+, through which the automaker is trying to comprehensively reposition itself. The new strategy focuses on clearer brand positioning across the various regions and segments, backed by significant improvements in efficiency and productivity. At the same time, the brand will be making massive investments in e-mobility and connectivity. It is known that two years back the company had admitted cheating on US diesel emission tests.
Electric and autonomous vehicles have become an important part of the strategy of the automakers, with several regimes backing clean-fuel cars. Several companies like Ford, GM, Tesla, Volvo, Daimler, Toyota are working to increase the share of electric vehicles in their offerings but the issue of profitability is yet to be sorted out. The high price of the electric battery remains a concern, although it has come down significantly in the last few years it is far from parity when compared to IC engine cars. There are other concerns as well as low range and lack of charging infrastructure.
Volkswagen to tackle the issue of profitability will maintain spending discipline and will draw on cost savings in all areas of operations, including vehicle development, administration, and manufacturing, as well as strong cash reserves.