Volkswagen aims to use its size to head off Tesla

Volkswagen is going all in on electric cars, with plans to build battery factories in Europe, install a network of charging stations and slash the cost of emission-free travel.

That was the message Monday as the German carmaker staged a so-called Power Day to showcase its latest electric car technology. The event was Volkswagen’s answer to Tesla’s Battery Day presentations, which draw intense attention from investors and electric car buffs.

The session included a number of attention-getting announcements, including a promise that Volkswagen would cut the cost of batteries by up to 50% by the end of the decade, while slashing charging time to 12 minutes. 

That would make electric cars cheaper than gasoline vehicles and just as convenient.

Volkswagen also unveiled plans to build six battery factories in Europe in joint ventures with suppliers. And by 2025, the company said, it would have 18,000 charging stations on the continent operating in conjunction with energy companies including BP. The British oil producer said it would offer charging at its filling stations.

“Our transformation will be bigger than anything the industry has seen in the past century,” Herbert Diess, CEO of Volkswagen, said during the two-hour presentation.

The event coincided with the rollout in the United States of the ID.4, an electric SUV that is part of the first generation of Volkswagens designed from the ground up to run on batteries and seen as serious challengers to Tesla’s dominance in electric cars.

At least some analysts are starting to believe Volkswagen’s hype. Swiss bank UBS issued a report this month that ranked Volkswagen just behind Tesla in electric vehicle technology.

Tesla leads in battery technology and software, the UBS report said, but the bank’s analysts gave Volkswagen high marks for its electric car platform — the chassis, motor and other components that drive the vehicle forward and carry the car body. The Volkswagen platform can be produced very efficiently and is flexible enough to accommodate a range of body types, UBS said.

Volkswagen is “a blueprint for what legacy carmakers need to achieve in the years to come,” Patrick Hummel, a UBS analyst, said last week.