FROM EIR DAILY ALERT
‘The Future of Volkswagen Lies in China’
Jan. 14, 2019 (EIRNS)—Building on its partnership with two of China’s biggest auto-makers, SAIC and FAW, Germany’s Volkswagen firm wants to greatly expand its cooperation with the Chinese—not just in China, itself, where VW sold 4.5 million cars in 2018, but also in third countries. From there, the global markets for e-cars and hybrid cars will be conquered.
“The future of Volkswagen will be decided in the Chinese market,” said VW CEO Herbert Diess, speaking to reporters in Beijing a couple of days ago. Diess said China will become one of the automotive powerhouses in the world, because
“what we find is really the right environment to develop the next generation of cars, and we find the right skills, which we only partially have in Europe or other places.”
Not just in China, but also in Europe, VW plans to spend more than $90 billion—one-third of the envisaged investments by car-makers in e-cars globally in the range of 300 billion dollars in the coming years. VW will develop the capacity on three continents to build up to 15 million electric vehicles by 2025, including 50 purely electric and 30 hybrid electric models.
VW’s staggering electric vehicle budget dwarfs that of its closest competitor, Daimler, which has committed $42 billion. In comparison, General Motors, the leading U.S. vehicle maker, has said it plans to spend a combined $8 billion on electric and self-driving vehicles. Roughly 45% of the global industry’s planned investment and procurement spending—more than $135 billion—will occur in China, which is heavily promoting the production and sale of electric vehicles through a system of government-mandated quotas, credits, and incentives.
Diess said VW is moving “to a new phase, where we will co-develop part of the automotive technology in China for the rest of the world. I think this is a significant step change.”