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A24 TECHNOLOGY
Monday 16 SepteMber 2019
Volkswagen bets big on electric. Will consumers buy in?

By DAVID McHUGH popular in wealthier coun-
AP Business Writer tries with per capita in-
FRANKFURT, Germany (AP) comes over 40,000 euros
— Volkswagen is rolling out ($44,100) a year, such as
what it bills as the break- Norway, Sweden and Swit-
through electric car for the zerland. In poorer countries,
masses, the leading edge electrics are nowhere to be
of a wave of new battery- seen. Just 293 were sold in
powered vehicles about to Slovakia and 315 last year
hit the European auto mar- in Greece.
ket. Incentives play a big role.
The cars are the result of big In Norway, where electrics
investments in battery tech- were over 30% of the mar-
nology and new factories ket last year, incentives
driven by environmental amount to 11,600 euros in
regulation and concerns tax breaks.
about global warming. Finding a place to charge
But it's not at all clear is another issue. Tesla has
whether consumers are its own network of high-
ready to buy them. Electric way fast-charging stations.
cars remain a niche prod- A consortium of automak-
uct, with less than 2% of the ers including Volkswagen
market, due to higher pric- aims to have 400 highway
es and worries about a lack charging stations by 2020.
of places to charge. It adds While Volkswagen has
up to a risky undertaking for been aggressive about
the companies. electric cars, others are
Volkswagen is betting that taking a more gradual ap-
the ID.3, with a roomy inte- proach. Daimler has the
rior, brisk acceleration and EQC sport-utility, which
battery range of up to 550 shares parts with an existing
kilometers (340 miles) for internal combustion vehi-
the top model, will change cle. That means lower new
things. It argues that the CEO of Volkswagen Herbert Diess introduces the new VW ID.3 at the IAA Auto Show in Frankfurt, investment spending. BMW
base price under 30,000 Germany, Monday, Sept. 9, 2019. is launching its iX3 electric
euros ($33,000) makes the Associated Press SUV and an electric Mini.
ID.3 "an electric car for ev- BMW's experience shows
eryone." A key competi- as the third chapter in the that undermine earnings emissions of carbon diox- the hazards: it was first with
tor, Tesla's Model 3, starts company's history, follow- in a weakening global ide, the main greenhouse an all-electric car, the i3 city
at 36,800 euros ($40,000) in ing the Beetle, which be- car market. Electrics were gas blamed for global car in 2013, but according
Europe, but the company's came a symbol of postwar only 1.8% of the European warming, that will kick in ful- to the Bernstein analysis lost
website indicates it can run German prosperity, and market through the first six ly in 2021 to comply with the money on it and cancelled
to well over 40,000 euros, the Golf, of which Volkswa- months of the year. Paris climate accord. Cars a successor.
depending on options. gen has sold more than 35 The launch of electric cars will have to produce no Other new electric cars at
The ID.3 went on display million since 1974. is so far mainly driven by more than 95 grams of CO2 the show include Daim-
Monday ahead of the The car will reach custom- regulation, not consumers. per kilometer, the equiva- ler's Smart fortwo and, at
Frankfurt Motor Show, and ers in Europe next year, Above all, companies are lent of requiring mileage of the high end of the mar-
Volkswagen is also reveal- while Volkswagen plans to rushing to make electric 66 miles per gallon under ket, Volkswagen's Porsche
ing a new logo. launch an electric SUV in cars to meet tighter rules U.S. measurements. is bringing out the Taycan
Both moves are aimed at the United States at an as- on carbon emissions and Failure to comply means a coupe, a direct challenge
underlining the company's yet unspecified date. pollutants, particularly in fine for every gram of C02 to Tesla's Model S. In all,
transformation since its 2015 The German company is the European Union and over the limit per car. In some 20 new electric mod-
diesel scandal, in which deploying extensive finan- China. practice, that means each els will hit the market by
Volkswagen was caught cial and manufacturing ca- "The industry has spent bil- electric car sold could be 2021. If demand is lacking,
using software to cheat on pabilities to make a success lions developing its new worth more than 10,000 carmakers may have to
emissions testing and paid of its electric cars, saying it generation of electric ve- euros ($11,000) in avoided offload the cars through
more than 30 billion euros will have invested 30 billion hicles," wrote analyst Max fines, according to Ferdi- sales to rental companies
($33 billion) in fines and euros in this area by 2023. Warburton at research firm nand Dudenhoeffer of the and corporate fleets, re-
penalties. The company is It has sunk 1.2 billion euros Bernstein. "Clean sheet de- Center for Automotive Re- quire employees to take
positioning itself as younger into a factory in Zwickau in signs with dedicated plat- search at the University of them as company cars, or
and more oriented toward eastern Germany to make forms ... have been engi- Duisburg-Essen in Germany. subsidize sales with gener-
digital services and zero lo- the ID.3, the first of eight neered at great cost. Bat- China, a major market for ous financing, all of which
cal emissions electric driv- planned electric-car plants tery pack assembly plants German carmakers, is also would sap profits.
ing. worldwide, including one in have been built. Huge pushing for lower-emission "We are proceeding on
Volkswagen CEO Herbert Chattanooga, Tennessee. cell supply contracts with vehicles. Regulatory pres- the assumption that there
Diess said that the launch The company, which sold Asian suppliers have been sure for electric uptake will be many incentives in
is "a decisive moment" for 10.8 million vehicles last signed." is less certain in the U.S., the market in 2020-2021,"
the company and that the year, aims for 40% of its sales "But this money is being where the Trump admin- said Dudenhoeffer from
ID.3 will "bring the electric to be electrics by 2030. spent without convincing istration has sought to re- the Center for Automotive
car from its niche into the Analysts warn that the in- evidence that customers lax standards set by the Research. "They are simply
middle of society." dustry could be saddled are waiting for these cars." Obama administration. condemned to sell these
The company touts the ID.3 with slow-selling products The EU has new limits on So far, electrics are most things."q