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VW boss Diess: electric car future "key success factor"

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CEO Herbert Diess sees the Volkswagen AG in the turnaround to electric cars well positioned. "As a group, we will make the electric car successful," he said on Tuesday at the general assembly of the automaker in Berlin. He called on politics to support the advance more strongly.

The Volkswagen Group plans to invest around 30 billion euros in electromobility by 2023. "2019 will be a key year of our e-offensive," said Diess. The drive technology is "by far the most efficient way to decarbonize" and "the key element of our CO2 strategy". Therefore, "a clear commitment to electromobility and a determined action of all involved" is required.

At the heart of the e-mobility plans is the newly developed electrification kit MEB. With the modular electric car platform, all Group brands could bring new models to market quickly and efficiently. "This creates high economies of scale in development, material costs and production," explained Diess. The e-kit will carry the world's largest number of electric vehicles. "The more cars are based on the MEB, the cheaper they will be," underlined the Volkswagen boss. "That's why we open the platform for third parties."

This year's Annual General Meeting showed that many Volkswagen investors are critical of the future focus on battery electric cars. This reaffirmed the strategy by saying that e-mobility is the key element in meeting the policy's stringent CO2 requirements. "For the foreseeable future there will be no alternative to battery electric drive," he said. Hydrogen technology and also synthetic fuels would not be available at reasonable prices or on an industrial scale with the required energy efficiency by the middle of the next decade.

In order to secure its e-car offensive, Volkswagen has decided to set up its own production of battery cells. "In view of the continuing increase in demand, we are forcing the construction and operation of a battery cell production together with a partner company," said Diess. The battery factory is to emerge in Salzgitter in Lower Saxony, but this would have to "fit the economic conditions," demanded Diess at the shareholders' meeting. Due to the high power requirements in cell production, the Group is primarily seeking exemption from the EEG surcharge, investment aids and tax benefits.

E-car "central success factor"

"The e-car will become a key success factor in the automotive industry in the future," emphasized Volkswagen in a statement published after the Annual General Meeting. This had previously indicated that the success of e-mobility – and thus of the company – will not only require further technical progress and price reductions. To take a leadership role, Volkswagen would have to change more. The company is still struggling in some places with cumbersome structures, complex processes and high costs. "There is a lot to do here," Diess said.

"We can not afford big ballast in the long run", warned Diess. 2019 will be a crucial year to make Europe's largest automaker more agile, efficient and transparent. "Efficiency programs are running in all brands in order to safeguard the results and to continue to sustain the significant future investments on their own," said the Volkswagen CEO. He also wants to focus the Group's focus more closely on the automotive business. "We're checking that we're still the best owner for the different businesses," Diess said.

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