Volkswagen to invest $40 billion in electric mobility technology by 2022

Last week, the Volkswagen board approved an investment of $40 billion in electric vehicles, autonomous driving and electric mobility technology.

Matthias Mueller, CEO of Volkswagen said: “With the planning round now approved, we are laying the foundation for making Volkswagen the world’s No. 1 player in electric mobility by 2025” adding that “the car is now being reinvented”.

Volkswagen will embark on the electrification or hybridization of every one of its approximately 300 brand models, including models from Audi, Porche, Seat and Skoda which the VW Group owns.

Bernd Osterloh, head of the company’s work council, said that €3 billion will be invested in VW’s base plant in Wolfsburg to prepare for the launch of the next generation Golf hatchback, and that the spending targets will include strengthening all of its 10 German factories.

More than €1 billion will be allocated to the Zwickau plant in eastern Germany to upscale electric car production at the site, which will switch to exclusively zero-emission vehicles production in the future.

The total direct investment during the 5-year budget planning is $85 billion.

The company will continue to invest in conventional auto technology, but half of the budgeting is dedicated to clean mobility technologies.

Mr. Osterloh said: “It was long and hard bargaining to safeguard the interests of the employees but I think we can live well with the compromise”.

At the same time, Volkswagen announced a €10 billion investment to new-energy vehicles (NEVs) in China by 2025.

Jochem Heizmann, Head of VW China announced the news during the Guangzhou Auto Show last Thursday, where he explained that VW will partner with Anhui Jianghuai Automobile Group (JAC Motors) for a new joint venture.

VW is set to launch 40 locally produced in China and production will begin during the first half of 2018.