| 1:23 PM EST

VW Hikes Tech Budget to $86 Billion

An already-massive push into electrification and software gets more so.
#europe #sustainability #emissions


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Volkswagen Group says it will spend a staggering $86 billion—more than $14 billion per year—between now and 2025 on electrification and digital technology.

Volkswagen is readying a wave of new EVs, including the ID. 3 hatchback (Image: Volkswagen)

The new five-year plan includes $41 billion for battery-electric cars and $13 billion for plug-in hybrid powertrains. Spending on digitation and software will double to $32 billion compared with the previous five years.

That’s not all. The VW Group projects its overall investments will reach $177 billion during the five-year period. Half that total—up from 40% in the previous five years—will be channeled into R&D and capital expenditures.

VW says the tsunami-level spending underscores its determination to become “climate neutral” by 2050.

The Warmup

To help make that happen, VW expects during the current decade to debut 70 pure-electric and 60 hybrid models. About 30 of those EVs and 30 hybrids are in production now, according to the carmaker.

All 130 of the announced electrified models will ride on one of two electric-specific platforms: the MEB (modular electric drive toolkit) or PPE (high-performance electric) chassis. VW expects to build about 26 million EVs and 7 million hybrids during the current decade.

Given the hefty new budget, those statistics are a mere warmup to what VW has in mind for the future.

Much of the $32 billion earmarked for digitization will go to the Car.Software unit VW launched at the beginning of the year. A top priority for the team is to develop and deploy vw.os, a proprietary software operating system for all models. AVW says Audi’s Project Artemis will be the first to use the platform in 2024.

What It Means

All carmakers are upping their spending on digitization, electrification and other future-defining technologies.

VW has articulated its plan better than most. The company also appears likely to outspend everyone else to achieve exactly the results it wants.

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