It looks like those pesky fines and settlements from their diesel emissions scandal didn’t hit Volkswagen too hard after all. The company recently announced the signing of $25 billion in supplier contracts that will allow the company to ramp up battery production for electric vehicles.
VW had previously announced plans to have as many as 16 EV plants up and running by 2022 as part of their Roadmap E strategy. This number compares to the three currently in place. The company is looking to ramp electric vehicle production up to three million vehicles annually by 2025, with no fewer than 80 EV models throughout a collection of brands that includes Audi and Porsche.
It’s estimated that 50 of these vehicles will be powered by batteries and 30 will be plug-in hybrids. By 2030, VW wants to offer an electric version of all 300 of their vehicle models. Many insiders feel this push is brought about by a need to aggressively move past the diesel-gate scandal.
Others state that this level of investment is VW’s way of throwing down the gauntlet as it takes aim at Tesla, which reportedly has similar deals worth about $15 billion in place through 2022, primarily for lithium-ion cells from Panasonic.
The remaining obstacle for VW, as well as any other electric vehicle maker or battery supplier, doesn’t relate to lithium, but to the cobalt used in the battery’s cathodes. According to an article featured on ScientificAmerican.com, VW and other EV companies could have to deal with an annual cobalt shortfall in the neighborhood of 40,000 metric tons by 2025 – when VW wants to be churning out more EVs than any other automaker, including Tesla.
Cobalt is an element that is mined as a by-product of nickel and copper, so not only is it dependent on the sourcing of those metals, but more than half of the world’s supply is located in the Democratic Republic of the Congo, which continues to be one of the most unstable countries in the world.