Volkswagen AG, the largest automaker in terms of global sales, has reportedly announced its plans to transform some of its factories to boost production of electric and self-driving vehicles. According to reliable sources, the move will also aid the German automaker to keep up with its rival Tesla Inc.
As a part of USD 86 billion (73 billion euros) investment plan, Volkswagen’s factories in Hanover and Emden will be retooled to boost the production of zero-emission vehicles, sources claimed. The company is also looking to become an expert in vehicle software programming in order to produce self-driving automobiles.
Reportedly, the Hanover factory will be retooled to produce Volkswagen’s ID Buzz microbus as well as other premium SUVs of Porsche, Bentley and Audi. Meanwhile, the Emden factory will be transformed to develop electric vehicles.
Herbert Diess, Chairman of the Board of Management at Volkswagen, was reported saying that the company has always focused on running valuable brands, increasing driving margins and improving its overall value.
Diess added that Volkswagen has come up with new body styles for its electric vehicles and has quite the advantage over Tesla since it has a well-established dealership network. The CEO further claimed that luxury brands which offer high horsepower combustion engines may not fit into electric and autonomous era.
For those uninitiated, Volkswagen has planned to separate its Italian motor vehicle division which includes Automobili Lamborghini S.p.A. as well as Ducati Motor Holding S.p.A. This will help the company to streamline its operations while focusing on mass producing electric vehicles, sources claimed.
It is to be noted that European policymakers have recently introduced stricter emission norms, which in turn has compelled automakers to accelerate the development of zero-emission technology. Evidently, this has also hampered the sales of combustion engine-based vehicles.
However, Volkswagen will need to generate profits from combustion engine-based SUVs in order to develop the necessary capital for investing in cleaner solutions, cited sources close to the company.
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