Come the end of this decade, Volkswagen Group foresees 50% of its vehicle sales coming exclusively from electric cars, the German automaker announced Tuesday. Perhaps more importantly, it expects EVs to reach a price parity with cars powered by internal combustion engines in the next two to three years. Citing its synergies across VW Group's multiple divisions, the company's New Auto 2030 presentation underscored why the automaker believes it's poised to win the burgeoning EV era.
VW Group CEO Herbert Diess assured a virtual audience, "Cars are here to stay," during the morning's presentations. In fact, he said the automaker sees "mobility," a buzzword that incorporates all personal transport, as including 85% real human drivers. That's not to say VW thinks autonomy won't play a role, though. In fact, VW believes completely self-driving cars will be ready by 2030 and it hopes to hold a massive slice of the profitable pieservices may one day dish up.
It's just one way VW thinks its business model will start to change in the future. How much profit are we talking? The auto industry may be worth $5 trillion by 2030, according to VW estimates.
Part of the massive value jump comes as vehicles include more software than ever, which VW also hopes to pivot towards. From an ultrasafe "virtual driver" for autonomous driving, mass-scale over-the-air updates, to anfor vehicles -- VW truly wants to own it all from the ground up. In fact, Diess told viewers future brand differentiation between divisions like Volkswagen, Audi and Porsche will come from "software and services."
On the physical manufacturing side of the business, VW Group promised its employees job security through the end of this decade as it works through this EV transition. Further it plans for two "gigafactories" for battery production: one in Sweden and the second in Germany. The option for a third factory is on the table, too, in Spain. The country may also be home to small EV production, VW said, though it hasn't made a final decision as it waits for the government to hash out potential subsidies for local production. A new, unified architecture called SSP will further simplify production between ICE and EV for every VW Group vehicle.
At the core, VW's roadmap follows a similar path to many others in the industry. The majority of automakers believe we're just at the tipping point of EVs, and the middle of this decade will produce the biggest change before an electric transition kicks off in 2030. If VW has its way, it'll own the sector with "emotional" cars, like the, smart technology and infrastructure to back it all up.