Due to the electric-vehicle incentives that came from the Inflation Reduction Act, Volkswagen is looking to increase its market share of electric vehicles (E.V.) in the United States. Furthermore, the top decision-makers at Volkswagen believe that these new EV incentives will ultimately double the company’s share in the US market.
Overview
According to the CEO of Volkswagen Pablo Di Si, his company plans to sell at least 25 different electric vehicle models in the US market by the year 2030. His plan is for all of these vehicles to qualify for the maximum credit of $7,500 as mentioned in the Inflation Reduction Act. Di Si went on to say that the availability of these credits will help his company gain more US market share in the EV sector. As of now, Volkswagen holds roughly 4% of the US automotive market share. However, they plan on increasing that to 10% by the year 2030. The EV tax incentives are helping the company achieve these goals. In an interview on Bloomberg Television, CEO Pablo Di Si stated, “We have a great opportunity in the U.S. I believe this is the right time and the right place.”
Investing in America
In order to increase EV production, Volkswagen plans on spending roughly $7 billion in the U.S. to achieve its goals. The company has already begun the manufacturing of its ID.4 electric SUV model. Additionally, Volkswagen will also begin manufacturing its electric van model in 2024 and plans to create a large and midsized EV in the next few years.
Catching Up to Tesla
CEO Pablo Di Si stated that he believes Volkswagen has an advantage over other vehicle manufacturers when it comes to taking advantage of growth in the EV sector. He also said that his company will be able to compete with the industry leader Tesla. When it comes to Tesla, they always have goals and objectives to even further increase their U.S. market share. However, Volkswagen is trying to get the jump on Tesla by expanding its production inside the United States.
United States Production
The American branch of Volkswagen has said that at least 80% of their new electric vehicle models will be produced in the United States and/or Mexico. This is due to the company’s goal of taking advantage of the Inflation Reduction Act EV incentives. In addition to increasing American production, Volkswagen has also hired a team of new designers in order to best capture the American style when producing their new EVs.
Wrap Up
History tells us that Volkswagen has made several previous attempts to gain U.S. market share, but ultimately experienced a lot of troubles when trying to do so. However, the Inflation Reduction Act could make things different for the car company. By taking advantage of the tax incentives and further immersing themselves in the EV sector, Volkswagen does have a chance of competing with their rival Tesla in the electric vehicle market.