Volkswagen Group revealed Thursday that more than half of its spending over the next five years will go toward electric vehicles and other high-tech initiatives.
VW anticipates electric vehicles to account for 25% of its global sales by the end of 2026. Currently, electric vehicles represent for 5% to 6% of Volkswagen sales.
VW would invest €89 billion, or slightly more than $100 billion, to accelerate its transition to electric vehicles as part of its plans. This is the first time VW has set aside more than half of its overall spending — around $180 billion — for electric vehicles. At the same time, spending on hybrid vehicles, which combine a battery and a gasoline engine, will be cut by 30%.
New factories, such as one at the company’s headquarters in Wolfsburg, Germany, will be part of the budget. Volkswagen’s Project Trinity, a new flagship electric automobile set to debut in 2025, will be manufactured in Wolfsburg. VW has announced plans for a number of additional plants around Europe.
Volkswagen also intends to establish its own battery production company. According to VW, the battery industry is expected to generate up to €30 billion in sales, which is more than the company’s present Skoda passenger vehicle sector.
VW also owns Porsche, Audi, Bentley, Lamborghini, and the Seat automobile brand in Spain, in addition to the Volkswagen passenger vehicle brand and the mass-market Czech Skoda.