Volkswagen Group just made a commitment to change its business strategy in the wake of the diesel emissions scandal that started last September. The German automaker will be introducing more than “30 new pure electric vehicles” by 2025, while also establishing a mobility solutions division. Two other German automakers are heading down a similar path. Daimler will be introducing a long-range electric vehicle this fall at the Paris auto show, but it’s just the tip of the iceberg for its electrification strategy, according to Mercedes-Benz USA’s chief executive. BMW will be adding to the i Series with the “i Next” as the automaker combines autonomous mobility with electrification in the BMW and Mini brands.
Here’s a look at each company’s upcoming product launches and what’s behind all of it……….
- VW’s STrategy: On Thursday, Volkswagen Group CEO Matthias Mueller laid out the company’s long-awaited “STrategy 2025″ at a press briefing in Wolfsburg. These 30 new EVs are expected to account for up to one-quarter of its sales – two to three million pure-electric cars a year by 2025. VW’s $300 million investment last month in ride-hailing app Gett was part of something much larger. The company says that its plans to establish a mobility solutions division that will develop its own services as well as acquiring businesses in areas such as ride-hailing, robo-taxis, and carsharing.
- Daimler’s long-range EV and long-range strategy: Mercedes-Benz will display a prototype of an electric-powered Mercedes car with a 310-mile range in October at the Paris motor show, development chief Thomas Weber recently said. Mercedes-Benz USA CEO Dietmar Exler just told Automotive News that the long-range EV to be introduced at the Paris show is just the tip of the iceberg for the brand’s electrification strategy. It will be way more than one EV, he said, and the company plans to sell more than 100,000 electric cars a year by the end of the decade. The electric car launch will compete with Tesla for leadership in luxury EVs. Weber said Daimler would launch its fourth-generation electric Smart car at year end in two- and four-seat variants. Daimler currently offers two all-electric cars as Smart and B-class models, and several plug-in hybrid variations. More hybrid models are in the pipeline, the company says.
- BMW focusing on urban mobility: BMW won’t be launching the next i Series car until 2021, as the German automaker focuses first and foremost on autonomous vehicle technologies. Sales of the i3 and i8 haven’t been strong enough yet, which is likely behind the delay. Called the “i Next,” for now it’s expected to be priced between the i3 and i8, it will be similar in size to the 5-Series, and will probably have its own number. Another factor for changing its focus to mobility from EVs has been BMW investing in recent years in urban mobility test projects and R&D efforts in Europe and North America. Like other automakers, BMW sees electrified vehicles tied intimately into mobile and autonomous cars of the future, as illustrated by plans for its next EV. “The i Next will be our new spearhead for innovation and technology,” said BMW’s sales and marketing chief Ian Robertson. “Planned for 2021, it will offer autonomous driving, digital connectivity, intelligent lightweight design, a totally new interior. And ultimately it will bring the next generation of electro-mobility to the road.”
- Facing diesel car emissions disaster: Volkswagen, Opel, Audi, Mercedes-Benz, and Porsche were told they will be recalling 630,000 vehicles to fix diesel emissions management software, a German government official announced in April. Fiat may be pulled into it, with German media reporting on regulators investigating the emissions of a Fiat model equipped with a diesel engine that may be evading emissions tests. The recall number has increased for VW, which gained approval earlier this month from Germany’s KBA motor vehicle authority to recall 800,000 of its diesel cars fitted with emissions cheat software. KBA has approved software fixes on Passat, CC, and Eos models with two-liter diesel en Last week, the company addressed that issue as part of its global strategy. “Volkswagen has always enriched the lives of millions of people all over the world with its brands and products,” VW’s Mueller said. “Our aspiration is to continue that success story and play a leading role in shaping auto-mobility for future generations, too. This will require us – following the serious setback as a result of the diesel issue – to learn from mistakes made, rectify shortcomings and establish a corporate culture that is open, value-driven and rooted in integrity.”
- Catching up with other countries: A statement made by a German government official last week illustrates the country’s ambitious goals for carbon emissions reductions – and for making its EV market stronger as it lags behind several other countries. Deputy Economy Minister Rainer Baake wants to make all new cars sold and registered in Germany to be emissions free by 2030 to assist in meeting pollution reduction goals. Germany’s pledge to cut carbon dioxide output by 80% to 95% by 2050 requires transportation pollution to be cut radically, Baake said. German Chancellor Angela Merkel has been pushing for more EV incentives to boost sluggish electric-car sales. Germany has been behind China, US, UK, Norway, Japan, and Netherlands in annual EV sales. In late April, the German government reached a deal with automakers to jointly spend 1.2 billion euros ($1.4 billion) on incentives to boost EV sales and support emissions reduction targets.
- Global competition: While Tesla Motors catches much of the flak for changing the EV game globally, it’s not just Tesla. In December, Ford announced that it’s investing an additional $4.5 billion in electrified vehicle solutions by 2020. The automaker will be adding 13 new electrified vehicles to its portfolio by 2020, when more than 40% of the company’s global nameplates will come in electrified versions. Nissan continues to expand its presence in markets around the world with the Nissan Leaf and the e-NV200 electric van. Honda has been adding plug-in versions of its models and remains committed to the technology along with fuel-cell cars. GM’s chief executive Mary Barra popularized the 200-mile EV debate earlier this year while championing the upcoming Chevy Bolt that will be launched prior to the Tesla Model 3. “This is truly the first EV that cracks the code because of long range at an affordable price,” Barra said in a keynote speech at the CES convention in Las Vegas.
- Mobility strategies: For these three German automakers, electrification is part of a much larger strategy to face an historic shift over to another business model. As said several times in Green Auto Market and other sources, carmakers are changing their identity from vehicle manufacturers with dealer networks to providers of mobility services for the cities of the future. Uber CEO Travis Kalanick and Daimler chief Dieter Zetsche denied rumors last week during a conference panel that Uber will be buying 100,000 vehicles from Daimler or that that two companies will merge. Daimler has been making headways into mobility on its own, starting a U.S. division of its Moovel mobility-services in April through acquiring Texas-based ride-sourcing company RideScout and Portland, Oregon-based mobile-ticketing service GlobeSherpa in April. Daimler’s Car2Go has been one of the leading carsharing services in Europe and North America for several years. VW recently made a $300 million investment in ride-hailing mobile app Gett. Fiat Chrysler Automobiles (FCA) will be testing out 100 driverless Chrysler Pacifica minivans with partner Google. Uber will continue to partner with automakers including Toyota and possibly with FCA. Retail giant Walmart is testing out grocery delivery services with Uber and Lyft. General Motors is planning on following up its $500 million investment in Lyft with a test project involving self-driving Chevy Bolts. Last week, the Mini Vision Next 100 electric concept car was shown to media in London. The autonomous electric car concept is based on a prediction that traditional car ownership will become optional. Mini and parent company BMW AG are investing more into the urban mobility market, which is expected to grow substantially in the coming decades.
- All three German automakers have research centers in California’s Silicon Valley, as automakers believe that advanced vehicle technologies – including connected cars, mobility services, autonomous vehicles, and vehicle electrification – shape the industry’s future. Silicon Valley neighbors Google, Apple, Uber, Lyft, and Tesla seem to be thinking the same way.