VW Announces $20 Billion Effort To Build Its Own EV Batteries (theverge.com) 36
Volkswagen said it would invest $20.38 billion to build electric vehicle batteries, a move the company says will create 20,000 jobs and generate $20.38 billion in annual sales. The Verge reports: The automaker will create a new company called Power Co to oversee the vast effort as VW races to secure enough capacity, materials, and supplies to power its EV ambitions. Power Co will manage VW's entire battery supply chain, from research and development of new technologies to the mining of the raw materials to end-of-life recycling. The news was announced at a groundbreaking ceremony for the company's first battery plant in Salzgitter, a city in Germany's Lower Saxony.
Last year, VW unveiled plans to build six battery cell production plants in Europe by 2030, including the facility in Salzgitter and one in Skelleftea, Sweden. A third plant will be established in Valencia, Spain, and the fourth factory will be based in Eastern Europe. The company is also exploring plans to build future gigafactories in North America. The plants will eventually have a production capacity of 240 gigawatt-hours a year. Starting in 2023, VW plans to roll out a new unified prismatic cell design of its batteries that will be installed across the automaker's brands. The goal is to have this unified cell design powering up to 80 percent of VW's electric vehicles by 2030. VW also has contracts with two other major battery producers, Samsung and CATL. And the company is backing a startup based in San Jose, California, QuantumScape, which is working on more energy-efficient solid-state batteries.
Last year, VW unveiled plans to build six battery cell production plants in Europe by 2030, including the facility in Salzgitter and one in Skelleftea, Sweden. A third plant will be established in Valencia, Spain, and the fourth factory will be based in Eastern Europe. The company is also exploring plans to build future gigafactories in North America. The plants will eventually have a production capacity of 240 gigawatt-hours a year. Starting in 2023, VW plans to roll out a new unified prismatic cell design of its batteries that will be installed across the automaker's brands. The goal is to have this unified cell design powering up to 80 percent of VW's electric vehicles by 2030. VW also has contracts with two other major battery producers, Samsung and CATL. And the company is backing a startup based in San Jose, California, QuantumScape, which is working on more energy-efficient solid-state batteries.
What does everyone think? (Score:2)
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Considering it already has vehicle production capabilities of about 11 million vehicles per year, and has recently successfully changed one of its oldest ICE production plants over to electric, it would seem that it has much greater potential production capacity than Tesla, which is likely to produce a bit over a million vehicles this year.
Tesla is ahead with electric car production currently, but for Tesla to match VW it will have to make 10x the number of car factories, whereas VW only has to convert exis
Re: What does everyone think? (Score:3)
Eventually yes, these are just massive legacy companies that still ship as many vehicles a month that Tesla does in a year but Tesla doesn't need to "beat" the likes of VW,GM and Toyota.
It's all about who makes the most batteries now. I can easily see a world where the auto giants by sheer force of will start to outpace Tesla in shipped vehicles but Tesla competes heavily in its core 40-70k price range, shipping 1-2m per year and maintaining very healthy profits while expanding more into other energy secto
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Will $25k cars really be a thing anymore?
Not everyone in the world lives in Silicon Valley making a 6 figure salary. The prime function of a motor vehicle is to provide a means of transport to individuals, nothing more. 85% of the world's motor vehicles are based outside of the USA.
A lot of people in 3rd world countries borrow money to buy their $500 iPhone, there is no way on earth they can borrow 100x as much to purchase a $50,000 "smartcar". And I doubt that people in poorer rural areas of the US are interested in getting rid of their ICE picku
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On the up side, the cars might get good enough that you don't ever own one, you just summon one and use for however long you need it.
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On the up side, the cars might get good enough that you don't ever own one, you just summon one and use for however long you need it.
What if you trained an organic life-form to safely control a car? The life-form could be given money in return for this service, which it could spend on food and shelter when it was not transporting customers.
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The Bolt is close, at a base MSRP of $25.6k and 259 miles of range. Although I bet that MSRP is going up next MY.
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Having worked on a lot of German cars, if there's one thing that you can't trust, it's the electrical system. German electric cars? HA!
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There ought to be less wiring, so if they ever get over the Bosch disease then they might be OK
And if they don't make some kind of soy wiring or whatever
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Yeah, I had a W126 300SD (which was the start of the bad wiring, thankfully not as bad as the W140) and now we have a Sprinter T1N and that's starting to have wiring issues... just a few years after Mercedes discontinued the harness, because of course they did.
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Will VW and co catch up to Tesla?
In time, yes. Tesla has the early mover advantage and is defining the technology in consumers minds, but the big car companies are HUGE.
The top 10 auto producers in the world (by volume) are:
Toyota - 9.5 million
Volkswagen - 8.9 million
General Motors - 6.8 million
Stellantis - 6.2 million
SAIC - 5.6 million
Hyundai - 4.9 million
Honda - 4.4 million
Ford - 4.2 million
Mercedes-Benz - 2.8 million
BMW - 2.3 million
Can Tesla be a Mercedes/BMW level competitor? Easily.
Can Tesla be a Ford/Honda level competitor? Yes
Re: Why VW wants to build its own battery? (Score:1)
Of course it's about control. You've seen Volkswagen's first logo haven't you?
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Vertical integration. Look it up. Some companies like having control over their entire supply chain. Given the distortions in the supply chain due to COVID, this is really prudent thinking.
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They should go even more vertical and make sure they have lithium supply. Better to invest and have too much lithium and sell or stockpile some than to not have enough and end up paying through the nose when the next supply crisis happens.
Tesla WAS buying batteries (Score:2)
While I can't say for the Chinese company(Teslas made in China have to follow China's rules), as far as I know Tesla is no longer buying batteries from Panasonic. They used to do so, back when their batteries were a shitton of 18650 cells. There may still be some licensing deals in place.
First, they bought Panasonic production, then it was a sort of co-production deal where Panasonic built batteries in a Tesla facility, but with the gigafactories, I believe that Tesla has shifted into having complete cont
Standards Please! (Score:1)
Another case of where I wish there were standards. Standard shape/size and contact points to deliver electricity to the car. Yes, you could have a few different classes of batteries like those for tiny passenger cars up to trucks and SUVs.
Imagine the EV recharge station of the future:
You pull up to a recharge spot and a robot removes your discharged battery and replaces it with a charged one. Done in a matter of minutes. Or you can simply plug in somewhere it you have the time to wait.
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You pull up to a recharge spot and a robot removes your discharged battery and replaces it with a charged one. Done in a matter of minutes.
I thought that would be a great idea, but now I don't. The vast majority of electric charging is done with slow chargers at night since most people don't drive that far per day, and hey one of the huge advantages of an EV is not having to go somewhere special to refuel.
For long journeys, that doesn't cut it. However, the new generation 800V batteries with the latest gene
Test results should look good (Score:2)
I've heard that VW has a lot of experience in getting their systems to pass compliance testing. Their batteries should look really good in their testing!
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Future news -- Dateline 2028:
Acting on an insider tip, government regulators have discovered that VW's battery production plans completely failed back in 2025. Consequently, it turns out that for the past several years, the "batteries" in their supposed EVs have instead contained huge numbers of miniature diesel engines. Apparently taking advantage of the EV exemption from emissions testing, these engines lack any emissions controls whatsoever.
This revelation may explain the mystery of why many owners and m
Misleading significant digits (Score:4, Insightful)
It seemed odd that the Verge article VW had an awfully specific (4 significant digits) investment amount of $20.38B which exactly matched the awfully specific annual sales of $20.38B.
This article suggests that it was actually a vague $20B Euros (1 significant digit). https://electrek.co/2022/07/07... [electrek.co]. That these 1 significant digit numbers are the same is not so surprising.
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It seemed odd that the Verge article VW had an awfully specific (4 significant digits) investment amount of $20.38B which exactly matched the awfully specific annual sales of $20.38B.
This article suggests that it was actually a vague $20B Euros (1 significant digit). https://electrek.co/2022/07/07... [electrek.co]. That these 1 significant digit numbers are the same is not so surprising.
Probably because the original announcement was 20B Euros, and American media just blindly run it through the exchange rate calculator (1 EUR ~= 1.02 USD) to come up with a $20.38B.
The is the same stupidity with science reporting of a "roughly 10km" meteorite reported as "roughly 6.21miles". Most Americans have no concept about significant digits anyway.
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Well, to be fair, if a roughly 10 km meteorite hit the ground, there wouldn't be many reporters left.
VW probably will survive (Score:3)
We are probably about five years away from the crossover point where half of all vehicles sold will be BEVs. BEVs are on an S-curve of disruption and combustion vehicles are on an S-curve of decline. After that point, a combustion car business will be a liability, not an asset.
Well, the legacy car companies were incredibly slow to figure the above out. Inexcusably slow. Elon Musk, in 2006, published the "secret master plan" on the Tesla blog, straight-up telling everyone what he was doing... nobody took him seriously. The Tesla Model S shipped in 2012... and they still didn't take him seriously. So now finally there's a mad dash where all the legacy car companies all woke up from their comas and got serious about EVs.
https://www.tesla.com/blog/secret-tesla-motors-master-plan-just-between-you-and-me [tesla.com]
JB Straubel, co-founder of Tesla and founder of Redwood Materials, commented that legacy car companies hadn't done the math on battery supply. They should have been setting up supplies like a decade ago, the way Tesla has.
https://insideevs.com/news/540267/tesla-cofounder-oems-ev-switch/ [insideevs.com]
I've been saying for years now that the idea that "the competition is coming" for Tesla is silly. The general idea is that the legacy car companies are so good at making cars that they could just decide "today is the day we crush Tesla" and start making BEVs. They would make so many BEVs that they would take market share away from Tesla and Tesla would lose and they would win. The big problem with this idea is: where will they get the batteries? Tesla already buys lots of batteries from all the big battery companies, plus has their own factories (and obviously they get all the output of their own factories). Tesla has so many batteries so where will the legacy companies get even more batteries than Tesla in order to out-compete?
So VW has announced that it's getting serious and building its own battery plants (like Tesla started doing in 2014). Good for VW; I think they have no choice if they want to survive.
Note how expensive this is for VW. I'm not sure that Tesla has spent 20 billion dollars on its whole business (including Gigafactory Nevada which makes batteries, their Kato Road battery R&D plant, and Gigafactory Berlin and Gigafactory Austin which both will make batteries).
There's a metric called the "Altman Z Score" that compares how much money a company is making (and various assets of the company) with how much debt the company has. Tesla has a very strong score and the legacy car companies are all in dangerous territory.
https://youtu.be/g63SJwFdGTQ?t=1300 [youtu.be]
https://www.investopedia.com/terms/a/altman.asp [investopedia.com]
https://www.tesmanian.com/blogs/tesmanian-blog/state-of-car-manufacturers-according-to-altman-z-scores [tesmanian.com]
Now VW and GM and others are taking on lots of new debt to build new facilities to compete with Tesla. This certainly won't improve their Altman Z Score. Not all of them will survive the transition to BEVs.
But VW is at least making sensible moves and not waiting even longer to take action.
P.S. The article also says that VW is standardizing on "prismatic cells". Elon Musk has commented that prismatic cells are great for LFP cells but a bad idea for high-nickel batteries. Tesla is using LFP for its lower-range vehicles (and for fixed storage like Tesla Megapack). So I'm wondering if this implies that VW is going all-in on LFP, or if it means that they don't agree with Elon Musk's risk assessment on the problem of thermal runaway in prismatic cells.
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VW has been making EVs for a while, starting with the e-Golf in 2011. Their current crop of cars has a decent drivetrain, but seems to be suffering some software issues and the BMS doesn't warn drivers about battery pack problems properly. Then again, Tesla's software isn't exactly known for its bug-free stability either.
BMW is another interesting player. Their drivetrain is very efficient, better than Tesla's in fact. It's just that they build super inefficient land barges around it. I guess they will neve
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BMW is another interesting player. Their drivetrain is very efficient, better than Tesla's in fact. It's just that they build super inefficient land barges around it. I guess they will never change
BMW buyers are buying them because they want that. But BMW has been developing the tech they need to move into basically any future. The work they've done on the i3 and the i8 has put them well ahead of any other automaker when it comes to manufacturing technology. Instead of building their own aluminum casting capacity they've been having other companies do that for them so they don't have to sink the capital.
The real problems for every automaker when it comes to increasing capacity are batteries and ICs,
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VW has been making EVs for a while, starting with the e-Golf in 2011
I think most people agree that the e-Golf was a "compliance car", a BEV made to comply with regulations in places like California, not an attempt to advance cars into the BEV age (like Tesla).
https://electrek.co/2020/12/23/vw-ends-production-electric-e-golf-favor-id3/ [electrek.co]
Tesla is a much smaller player in Europe, not least because their cars are very expensive
Tesla has been building cars in China, shipping them to Europe, and presumably paying i
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I know someone who had an e-Golf. Regardless of why it was made, it was a decent car.
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The internal combustion engine is not going anywhere.
I predict usage of ICE will go off a cliff in the next decade. We won't forget how to make ICE vehicles or anything silly like that, but for most people most of the time BEVs will be preferable.
It comes down to cost. A BEV is cheaper to maintain, cheaper to "fuel", and should break down less and cost less to repair. Right now, it costs more up-front... but that's about to change. Once a BEV has a significantly lower up-front cost, very few people woul
Good. (Score:3)
Just as Europe was way too dependent on Russia, the west is far to dependent on China esp. for high tech.
Sourcing (Score:2)
They plan to source all the raw materials from Russia. What could possibly go wrong?