The German car giant shifts its focus to clean-energy vehicles after the dieselgate emissions cheating scandal. Brand chief Herbert Diess claims that the automaker aims to sell one million electric cars per year by 2025. This would make it the global market leader in electromobility. Herbert Diess also added that the switch to electric will be funded through new investments and economies of scale, and is a crucial part of the troubled brand's efforts to reinvent itself.
Last Friday Volkswagen announced the biggest revamp in its history, saying that it would cut 30,000 jobs to save 3.7 billion euros ($3.9 billion) a year by 2020, while ramping up investment in future technologies such as electric cars, self-driving cars and digitalisation. Herbert Diess said that the industry will undergo more fundamental change over the next 10 years than ever before. He predicted that "the breakthrough" of electric cars was just four or five years away and would be driven by environmental concerns. He has no doubt that for most customers the electric car will soon be the better alternative.
The shake-up at Volkswagen's core brand comes as the group tries to recover from the biggest crisis in its history after it admitted last year to installing emissions cheating software in some 11 million diesel vehicles worldwide. The so-called defeat devices could detect when a vehicle was undergoing regulatory tests and lowered emissions accordingly to make the cars seem less polluting than they were. The crisis hurt sales and damaged the image of the proud German company, pushing it to its first loss in over two decades last year. Even before dieselgate, the VW brand had been struggling with profitability, weighed down by high costs and low productivity.