Volkswagen turns into the electric revolution when Angela Merkel takes to the streets
It wouldn’t be a surprise if the latest blockbuster float from the electric truck manufacturer Rivian also woke people’s minds in Wolfsburg, where VW is based. Although not a single vehicle is on the road, the Californian start-up is valued at $ 100 billion on the Nasdaq.
Although VW gave its crown as the world’s largest automaker to Toyota again last year, it still produced more than 9 million cars and is still worth only $ 130 billion.
A separation from Porsche will be a big moment. The bitter takeover saga that left VW in control has gone down in folklore. VW responded to a hostile offer from Porsche by turning the tables and becoming a buyer.
However, the shift to electric vehicles will be much larger. After slowly reacting, car brands are rushing their future to electrification despite concerns about price, range, reliance on rare earth materials, availability of batteries, and a lack of critical charging infrastructure.
The big question is, will mass-market automakers have the skills and expertise to make the transformation, or will the established names be forced to hand over their dominance to a new generation of more agile, tech-savvy rivals led by Tesla?
The unions’ resistance will prove to be one of the greatest obstacles for VW. Boss Herbert Diess is a vocal advocate of rapid change and has angered the trade unions, which have four seats on the car maker’s supervisory board, with the fateful forecast that the failure to accelerate electrification will cost up to 30,000 jobs, which corresponds to one in four in his home country .
The support of the German Porsche-Piech family is also decisive. They are reportedly ready to weaken their control of VW in exchange for regaining control of Porsche in a scheme codenamed “Phoenix”.
The idea of something rising from the ashes is certainly moody, but it may surprise VW employees to learn that management thinks the company is on a burning platform.