Volkswagen claims: The era of internal combustion cars is not over yet

(Patria) - Volkswagen has announced that it is not giving up on internal combustion cars despite the industry's shift towards electrification.

Although the Volkswagen Group earlier announced that its strategy would be a complete orientation towards electric vehicles, it now plans to direct two-thirds of its capital towards electrification and digitalisation.

One third will still remain reserved for internal combustion cars, emphasised the financial and operating director of the VW Group, Arno Antlitz, at a Reuters event in Munich last month.

- Electric vehicles are the future, but the era of internal combustion cars is not over - said Antlitz.
VW now plans to develop a small, affordable BEV without a partner after its partnership negotiations with Renault fell through.

VW's initial BEVs will cost 20,000 euros and will focus primarily on sales in Europe, the company announced.

At the same time, VW acknowledges that it will have to balance the reduction in BEV sales with more plug-in hybrids.

This is in contrast to its earlier plans that the ID series of electric cars would be key to its future.

Former CEO Herbert Diess announced plans to introduce up to 75 fully electric vehicles over the next decade, stating in 2021 that electric mobility had "won the race".

VW has faced major difficulties in its electrification strategy. Earlier plans with various EV launches failed. VW has also fallen behind in China, facing strong local competition.

Like other German car manufacturers, VW is also reacting to the further expansion of Chinese rivals such as BYD and SAIC's MG Motor into Europe.

VW has also abandoned plans to seek investment for its battery unit and to build a 2 billion euro EV factory in Germany.

Meanwhile, VW could slow down the time needed to ramp up capacity at its battery factories.

VW will still start production in 2025, but it could take longer to reach full capacity, Antlitz said in an interview with Bloomberg.

According to current plans of 20 billion euros, PowerCo should supply cells for about 3 million EVs by 2030.

Similarly, Mercedes-Benz plans to keep producing internal combustion cars well into the next decade, retreating from its earlier plans to sell only electric cars by 2030, Bloomberg reported.