This is Volkswagen’s Brilliant Strategy To Dominate The EV Market!

When Henry Ford unveiled the Ford Model T in the year 1908 the people loved it and literally, everyone went on to buy a Model T for themselves. The arrival of the Model T was the start of a new revolution and it was responsible for putting the world on wheels.

Model T was a game-changer for the American automotive industry. The story of Tesla’s Model S also is the same they have revolutionized the electric vehicle industry and the way we look at electric cars. When we closely observe we see certain aspects which lead to the success of both the companies.

Key aspects which lead to the success of the Ford Model T and Tesla Model S.

  • Innovative design for their time.
  • State of the art production methods.
  • Dedicated and custom-designed manufacturing plants.
  • Room for customization of vehicles(They had a variety of options).

But despite the similarities, there was a major difference between the Model T and Model S which was ‘AFFORDABILITY’.

Model T was designed and made for the common American while the Model S was reserved for the elite. Model T was a huge hit and welcomed by people in all classes of the society while Model S couldn’t enjoy the wide acceptance though it was a great car owing to its hefty price tag of $74,990 to $71,990.

Why Electric Cars Are Expensive?

One-third of the cost of an electric car goes to its batteries. An electric vehicle (EV) uses the same rechargeable lithium-ion batteries that power your laptop or smartphone required.  

  • These batteries bigger and can produce a lot more power.
  • The cathode, one of the two electrodes that stores and releases a charge, is the most expensive part in each cell.
  • This is due to the high cost of the materials used in cathodes to store more energy, such as cobalt, nickel, lithium, and manganese. 
  • These minerals and chemicals have to be mined, refined and converted into high-purity chemical compounds. 

Volkswagens Ingenious Plan To Dominate The Electric Mobility

In the wake of worldwide acceptance which electric cars receiving currently the global automobile giant, Volkswagen had identified electric vehicles as their core business and it’s a huge deal. Volkswagen had tremendous growth in its electric car sales as much as 214% in the last year.

An ID.4 in Dusk Blue Metallic drives on an urban road.

Now their plan is to develop, manufacture and deploy more affordable batteries without decreasing the range or capacity.

The Action Plan

With the aid of a single-cell battery pack it is currently developing, Volkswagen hopes to reduce battery costs for entry-level electric vehicles by as much as 50%. Volkswagen revealed at the first-ever Volkswagen Power Day that it is working on a single-cell format battery that will be used in up to 80% of the VW Group’s electric vehicles by 2030. Volkswagen will manufacture this single-cell battery in-house and release it in 2023.

Volkswagens action plan is consisting of,

  • To reduce the battery’s cost and complexity while still increasing its range and efficiency.
  • The battery systems would be substantially cheaper than €100 per kilowatt-hour.
  • The new unified cell provides the “perfect conditions for the transition to the solid-state cell,”.
  • which the industry hopes to be the next quantum leap in battery technology.

But there is more

#1. The Giga Factories

Apart from the new improved battery technology, Volkswagen is planning to set up 6 Giga factories solely dedicated to batteries across Europe by 2030. Each gigafactory is projected to produce up to 40 GWh per year, taking the total energy value to 240 GWh until all of the gigafactories are operational.

Setting up manufacturing plants for batteries will cut down the battery cost by,

  • Large scale automation. Since the plants are supposed to be state of the art technology, human intervention will be very less.
  • Dedicated machinery and infrastructure for the batteries will result in high production rates.
  • The plants are said to have their own recycling unit thus eliminating scrap as much as possible.
  • The new plants will make Volkswagen self-sufficient and can be immune from local and global inflations and other logistical hassles.

The first two factories will be located in Salzgitter, Germany, and Skelleftea, Sweden; a third factory will be located in Spain, Portugal, or France; and a fourth factory will be located in Eastern Europe.

#2.Expansion Of Charging Network

Volkswagen will also build 18,000 public fast-charging points in Europe by 2025, up to 17,000 fast-charging points in China. Volkswagen claims that fast-charging time will be reduced to as little as 12 minutes by the middle of the decade because of its unified cell battery.

According to the automaker, its network will cover around a third of the continent’s overall demand at that time. Volkswagen’s electric vehicles will also be able to link to residential, industrial, and public energy networks starting in 2022.

In addition, the company intends to recycle up to 95% of the raw materials used in battery manufacturing.

The People’s Car

The name Volkswagen means people’s car in German. Over the years they have strived to be faithful to their name and now they are doing the same in the electric car industry. They make their cars more affordable and accessible to the public by reducing battery costs and decreasing the overall production cost of electric cars.

If the new strategy becomes successful other giants also will have to find ways to reduce the price which will eventually lead to healthy competition among the companies. We, the consumers will derive the benefits of these competitions better cars, better prices, etc.

You may also like