Get all your news in one place.
100’s of premium titles.
One app.
Start reading
The Street
The Street
Rob Lenihan

Volkswagen Makes a Promise That Tesla May Not Like

The tide is high, but Herbert Diess is holding on.

The Volkswagen (VWAGY) CEO admitted that arch-rival Tesla (TSLA) came on stronger than expected, but he still believes that the maker of the iconic Beetle can pull ahead of Elon Musk & Co. and become the world's largest seller of electric vehicles by 2025...maybe.

'We Won't Give Up'

"We didn’t expect our main US competitor to be so fast and well-prepared,” Diess said, at the Financial Times Future of the Car 2022 conference. “It will be tight but we won’t give up on it. I would still see a chance that by 2025 we are first. At least second.”

Diess said the company has sold out of battery electric vehicles in the U.S. and Europe for 2022.

"We are not sold out because we can't build cars ... we are really sold out for electric cars because demand is higher than expected," he said. 

Volkswagen, which has a backlog of 300,000 EV orders in Western Europe, sold 99,100 electric vehicles in the first quarter of 2022. Tesla sold 310,000 in the same period.

Tesla led the worldwide electric vehicle market 2021 with a 14% share of the market but Volkswagen was right behind it with a 12% market share, the research firm Canalys said in February.

Expansion Plans

Volkswagen, which makes the iconic Beetle, doubled its EV sales in 2021 compared with 2020 and led the market in Europe.

Nearly 60% of the Volkswagen EV sales were from the VW brand, with good support from Audi, Cupra, Porsche, SEAT and Skoda, thus giving it a presence in a range of EV segments.

While the Tesla Model 3 was the best-selling electric car in Europe in 2021, Volkswagen was the leading manufacturer of electric vehicles, Canalys said.

Of the 8.9 million vehicles VW sold last year, 452,900 were pure electric. Tesla sold nearly one million electric vehicles in 2021.

Earlier this year, Volkswagen said it would expand its plant in Chattanooga and create 1,000 jobs there as the factory gears up for electric vehicle production beginning in 2022.

The German automaker said in March that it was putting down $7.1 billion in North America over the next five years to push its electrical and digital makeover as Volkswagen aims to drive 55% of U.S. sales to be fully-electric by 2030.

Close to Home

On the home front, Volkswagen plans on spending some $2.2 billion to build a new manufacturing facility for its Trinity electric vehicle that will be built near its main plant in Wolfsburg.

Construction is to begin as early as spring of 2023, Volkswagen said, with the net carbon-neutral Trinity model rolling off the assembly line from 2026.

But then Tesla muscled into Volkswagen's backyard in March when the company opened its Gigafactory in Berlin about 140 miles away from the Wolfsburg facility.

Now Tesla is looking to purchase an additional 100 hectares of land on the site, according to the German media outlet rbb24.

Tesla wants to keep vacant land that it already owns on the Giga Berlin property free so that it can expand manufacturing operations later on, according to the report.

Sign up to read this article
Read news from 100’s of titles, curated specifically for you.
Already a member? Sign in here
Related Stories
Top stories on inkl right now
One subscription that gives you access to news from hundreds of sites
Already a member? Sign in here
Our Picks
Fourteen days free
Download the app
One app. One membership.
100+ trusted global sources.