The Volkswagen Group has revealed its ‘New Auto’ business strategy, a plan that will run through 2030 and encompass a broad set of changes related to electrification, automation, and mobility. The strategy ultimately aims to reduce the Group’s carbon footprint. By 2030, it aims to have reduced the carbon footprint per car by 30% across the individual vehicle lifecycle (against 2018 levels). This aim correlates closely with the Group’s other goals, including growing its share of BEVS to 50% by 2030, delivering zero-emission vehicles by 2040, and achieving climate neutrality by 2050. To achieve these goals, the Volkswagen Group have split the plan into four distinct areas.
The first of these is the Volkswagen Group’s new Scalable Systems Platform (SSP). The SSP is the successor to the Group’s previous platforms (MEB and PPE), and is integral to the New Auto strategy. The electric vehicle platform is to be used across its vehicle portfolio – covering mass market brands, including Mazda and Honda, as well as luxury ones, like Audi and Porsche. EVs built on SSP will be introduced from 2026 onwards, with the Volkswagen Group aiming to make more than 40 million across the platform’s lifecycle. The Group have also confirmed that SSP will be provide SAE Level 4 (L4) autonomy and be offered to third-party OEMs. To reach these projected milestones, the Volkswagen Group plans to invest around €800 million in a R&D facility based in Wolfsburg, Germany to develop the SSP and its modules.
The second element of New Auto centres on E3 2.0, a new global software platform developed by CARIAD – the Volkswagen Group’s software division. It builds on the work of previous software generations to deliver the SSP’s autonomous capabilities and will operate on all vehicles released by the Volkswagen Group. E3 2.0 will be introduced in 2025 through a gradual transition from the Group’s current software stack, E3 1.1. In 2023, it will launch E3 1.2, which enables several new functions – including over-the-air software updates for EVs from Audi and Porsche. In 2025, E3 2.0 will launch – serving as the core OS for all vehicles under the Volkswagen Group – delivering end-to-end architecture and facilitating L4 autonomy.
The Group also outlined a new approach to batteries, which will see the corporation establish its own supply chain – controlling the lifecycle from material sourcing to battery recycling. Through this control, the corporation hopes to increase the sustainability and reduce the cost of battery production – leveraging its partnerships to do so. The Volkswagen Group has expanded its partnerships with charging providers such as Electrify America (North America) and CAMS (China) alongside BP, Iberdrola, and Enel (Europe). The Volkswagen Group entered a joint venture with Enel X to provide Italy with more than 3,000, ultra-rapid, EV charging stations by 2025. This is just one of many steps the Group will take to achieve its goal of installing 18,000 high-power charging stations in Europe, 17,000 in China, and 10,000 in the U.S and Canada. The Group is similarly leveraging partnerships to open six battery gigafactories in Europe. The first of these plants will operate in Skellefteå, Sweden in collaboration with NorthVolt, with production to begin in 2023. The second, part of an agreement with Gotion High-Tech, will be in Salzgitter, Germany and commence operations in 2025. In the same year, the Group plans to open another gigafactory in Spain to handle the production of vehicles in its small BEV family, with a projected annual capacity of 40 GWh.
The most radical area of the Group’s strategy is mobility – by 2030 it plans to launch several autonomous driving solutions that serve four key business areas: self-driving systems, vehicle integration, fleet management, and a mobility platform. The corporation is already developing technologies for autonomous shuttles with its partner ARGO AI. CARIAD is similarly developing the L4 autonomous technologies that will feature in the Volkswagen Group’s passenger vehicles. A pilot project in Munich is presently testing autonomous buses, and the Group plans to expand it further across Germany and introduce similar projects in the US and China. In 2025, this research and development will culminate in the launch of the Volkswagen Group’s own autonomous mobility service in Europe. The service will give customers access to a fleet of AVs that can be booked through a smartphone app. Eventually, one platform will integrate the Group’s mobility services across its brand portfolio – such as renting, subscriptions, sharing, and ride-hailing. Much like the core aim of New Auto, the Volkswagen Group’s entry into the MaaS and TaaS markets is set to provide it with both a sizeable market share, and several new revenue streams.
Overall, the Volkswagen Group’s New Auto strategy is certainly an ambitious one – with dozens of goals set over the next decade. It also looks set to upend the corporation’s business model with a sharp move towards shared services and autonomy. However, it has already begun the necessary work to achieve these milestones. While the rollout of new products and services developed through the strategy is not expected to begin until 2023, it is very likely that will we hear more from the Volkswagen Group about it before then.