Volkswagen's CEO says its latest round of investment in electric self-driving cars will let it finally 'beat Tesla'
Volkswagenis increasingly transparent about how it plans to catch Tesla's lead in electric vehicles.
- In a conference call Monday with analysts and investors, its CEO outlined an increased and accelerated investment into its electric powertrain and software development.
- "The commitment, the investments, and the industrialization plans are there to beat Tesla," Herbert Diess said on the call.
- Volkswagen's first true Tesla competitor, the ID.4, will hit the North American market next year.
Volkswagen boss Herbert Diess has been perhaps the most outspoken automotive executive when it comes to the industry's elephant in the room.
For years, the German has expressed a mixture of admiration and competitive attitude for Tesla. But as Elon Musk's automaker closes in on opening a factory in
"Everything is set up to become, on the technological basis, competitive with Tesla," Diess said on a conference call Monday regarding the automaker's five-year investment plans, according to a transcript accessed through Sentieo.
By 2025, VW is planning a fully electric flagship car for most of its brands including Audi, Bentley, and Porsche. That's on top of VW's ID.3, which is already in production, and an ID.4 set to target the mass-market American SUV segment next year. It's all part of a 73 billion euro investment in its electric powertrain and software development, announced Monday.
"We have more different body styles and more brands," Diess continued. "And also when it comes to the established dealer network, we should have one or the other advantage over Tesla. I would say, the commitment, the investments, the industrialization plans are there to beat Tesla."
Volkswagen has a long way to go to top Tesla's sales, and Musk has said the company aims to be at a half-a-million annual clip by the end of 2020. However, VW brings a wealth of manufacturing capacity and expertise to the competition.
It's also taking what many industry insiders say is the only profitable and sustainable way to switch from internal combustion to battery power.
"A steep cost reduction curve in combination with an ever-improving regulatory environment in favor of EVs makes it a necessity for auto companies to pursue an 'all-in' EV strategy, meaning that purely CO2-compliance strategies are likely to fail," UBS analysts said in October.
To get there, Diess said VW has clear work to do, especially with regards to staying nimble and changing quickly at an old, storied automaker.
"If you look in startup companies like Tesla, starting with a clean sheet or white sheet of paper, they started with a lot of embedded software," he said, commenting on VW's plans to engineer its own operating system in its latest vehicles. "And their way is also continuous. So this is what we have in front of us."
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