Volkswagen awards battery-purchasing contracts worth 40 billion euros

Volkswagen awards battery-purchasing contracts worth 40 billion euros

At German automaker Volkswagen AG’s annual shareholder meeting in Berlin on Thursday, CEO Herbert Diess told investors that the automaker has recently awarded battery-purchasing contracts valued at a total of 40 billion euros ($48 billion). The order for batteries confirms the massive investment Volkswagen has planned in EV segment.

With Volkswagen (VW) aggressively intensifying its efforts in the electric vehicle (EV) industry, the recent disclosure by Diess implies that the automaker’s latest orders for EV batteries underscore a two-fold increase over its orders from a few weeks back. Moreover, according to the information shared by Diess, VW is aiming at a sales target of ‘3 million all-electric cars per year’ by 2025.

The 40-billion-euro worth of EV battery orders which have just been awarded by VW have taken the automaker closer to the 50 billion-euro total figure which it appears to be seeking fervently. The recent change in attitude of management of big automobile companies in favour of electronic vehicles segment confirms the industry estimates of better future for the segment.

In reference to its latest Volkswagen EV batteries orders, industry experts compare the value of latest order for batteries to the entire market value of US-based electric vehicle manufacturer Tesla. Elon Musk led Tesla Motors has been in focus as the company has been leading the EV segment. However, industry experts suggest that Tesla Motors will face tough competition as the big automobile companies enter EV market.

Meanwhile, about VW’s plans in the EV arena, Diess said that the automaker will bring “more than 25 new electric models and more than 20 plug-in hybrids” to the market by the year 2020; and added: “In just a few years’ time, then, across all brands and regions, we aim to put the world’s largest fleet of electric vehicles on the road.”