Germany’s Volkswagen has announced that it is accelerating its move away from the internal combustion engine, expecting fully-electric vehicles to make up more than 70% of its European sales by 2030, a marked difference to the previously-anticipated target of 35%. By the same year, VW is hoping for electric to make up over half of its sales in the United States and China.
The brand is reportedly still continuing the development of engines currently in use and preparing them to meet new emissions standards, but will use money earned from vehicles with combustion engines to further its electrification efforts.
Audi announced a similar strategy earlier in the month, with plans to adapt its existing combustion engines to emissions guidelines but cease development of new combustion engines. As for when the last one will be produced, Audi’s CEO Markus Duesmann stated, “Our customers will probably decide when the last combustion engine comes off the production line.”
The automaker expects over 70% of it’s Volkswagen brand’s sales to be EVs by 2030
“We are stepping up the pace,” Ralf Brandstaetter, who leads the Volkswagen brand, said in a statement. “In the coming years, we will change Volkswagen as never before.” The company also owns Audi, Lamborghini, Porsche and several other luxury brands, but Friday’s announcement applies to VW-branded vehicles, which include the Passat and Jetta.
Volkswagen said it plans to spend about 16 billion euros for investment in the future trends such as e-mobility, hybridisation and digitalisation by 2025. The automaker also plans to make autonomous driving features widely available by 2030.
Volkswagen is the latest automaker to accelerate or announce a shift away from vehicles with traditional internal combustion engines to all-electric motors. Volvo earlier this week said it will only offer EVs by the end of the decade, while General Motors has said it plans to become a fully electric automaker by 2035. Stellantis, the product of the merger between Fiat Chrysler and PSA Groupe, plans to have fully electric or hybrid versions of all of its vehicles in Europe by 2025.
The all-electric ID. BUZZ01 will be the first vehicle in the Volkswagen Group to be driven autonomously
While such targets may seem far off, it traditionally takes automakers five to seven years to develop and launch a new vehicle. EVs are expected to cut down on that time frame since they require fewer components than traditional gas-powered cars and have some of the same parts that can be used to build either.
The announcements follow optimism by investors in EV start-ups as well as a surge in Tesla’s stock last year that made the California company the world’s most valued automaker by market cap.
Government incentives and tightening CO2 emissions targets are driving automakers to release EVs more than customers are demanding them. IHS Markit reports EVs accounted for about 3.3% of the 76.5 million vehicles sold globally in 2020. The research firm expects sales of EVs to rise to 12.2 million in 2025, indicating annual growth of nearly 52%.
The Volkswagen Group, of which VW and Audi are key members, previously planned to introduce its final combustion engine platform in 2026, ending its lifecycle by 2040.