Volkswagen is investing even more in the car of the future

(Frankfurt) The automaker Volkswagen will further accelerate its investments in the electric and connected car, to 89 billion euros over the next five years, to assert itself in the race for the car of the future currently dominated by Tesla.

The group will devote 56% of its total investments of 159 billion euros to these key technologies, against 50% for the period between 2020 and 2024, and estimates “that one in four cars sold” will be electric in 2026.

“We are engaged in the biggest transformation in the history of the Volkswagen group,” commented boss Herbert Diess, at the heart of a violent conflict with employee representatives buried Thursday thanks to a compromise in the allocation of responsibilities.

The announcements come after the annual meeting of the supervisory board devoted to the multi-year investment plan.

In 2020, the group announced 73 billion euros of investments in the car of the future for the period up to 2024.

“The need for additional investment comes in particular from an accelerated development of electric mobility within the framework of the European Green Deal”, Volkswagen notes in a press release.

Investments are also progressing to finance the opening, with industrial partners, of six battery cell mega-factories in Europe in the coming years.

Investment in electricity increased by 50% to 52 billion euros, while the funds allocated to the hybrid – described as “transition technology” – fell by 30% to 8 billion euros.

The digital transformation will cost around 30 billion euros.

To meet the strong demand for electricity, production of the flagship model ID.3, currently in Zwickau, will also start at the historic site in Wolfsburg, where no electric model is currently produced.

The future electric and connected sedan, called Trinity, which Volkswagen plans to market in 2026, will be produced in a new plant near Wolfsburg.