Volkswagen has announced a commitment of US$7.1bn over the next five years to boost its regional R&D and manufacturing capabilities in the North American region (NAR1).
“American ingenuity and manufacturing know-how are at the heart of our strategy for growth, and thousands of men and women are working hard every day throughout North America to bring the Volkswagen brand to life for consumers,” said Scott Keogh, president and CEO of Volkswagen Group of America. “This profound commitment to our localized capabilities will transform Volkswagen into one of the leading EV brands known for its commitment to innovation, quality and the communities we call home.”
Keogh also announced that Volkswagen will begin to phase out gasoline-powered vehicles from its American line-up, aiming to exit from IC sales at the beginning of the next decade. To replace them, VW will advance its electric line-up, including the American-assembled ID.4 in 2022, the ID. Buzz electric microbus in 2024 and new electric SUVs from 2026. In all, Volkswagen Group brands plan to introduce more than 25 new battery-electric vehicles (BEVs) to American consumers through 2030.
Volkswagen’s stated aim is to localize all major design and engineering responsibilities for the ‘vehicle hat’ (body and interior) of products destined for the domestic markets by 2030. This approach reflects the company’s emphasis on American consumer demands while scaling Volkswagen Group’s global vehicle platforms (MEB and future SSP).
Volkswagen is also expanding its battery development capabilities in the United States. Its new Battery Engineering Lab (BEL) in Chattanooga, Tennessee, will start operations in May this year. As a result of a US$22m investment, the BEL will enable the company to test and validate batteries for all Volkswagen electric models in the American marketplace.
On the research side, a Center of Excellence (CoE) NAR Battery with locations in Belmont, California, and Chattanooga, will accumulate know-how and research capabilities in battery cell technology. The CoE collaborates closely with technology partners QuantumScape (San Jose, California), which is developing solid-state battery technology, and 24M (Cambridge, Massachusetts), which is working on the design of battery cells.