Volkswagen continues to take market share from Tesla
In what may be the worst April Fools joke of 2021 – Volkswagen rebranded (jokingly) its name to “Voltswagen”. An indication of how serious they are in going electric – and taking down Tesla.
For any other company, the PR scheme would have been genius. Unfortunately for Volkswagen, this only reminded people about its 2015 emissions scandal – which cost the carmaker over $30b in compensation and repair costs.
A Lesson Learned
Since its emissions scandal snafu, the company has made a major pivot towards electric vehicles (EVs) by:
- Raising its EV investment budget from €60b to €73b over the next 5 years.
- Announcing plans to build six EV battery factories across Europe by 2030 to meet its growing demand for batteries
- Investing over $300m in QuantumScape ($QS), which develops solid-state lithium batteries for EVs
It’s also targeting 50% of total sales to come from EVs by 2030 – up from its previous target of 25%. And Investors are loving the change.
Volkswagen’s stock is up nearly 80% in 2021 and has outperformed other EV makers: Tesla, which is down 8% and NIO, which is down over 25% in 2021.
“The Samsung to Tesla’s Apple”
Tesla’s ($TSLA) dominant hold on the EV market may be slipping. The resident king of EVs has seen its market share erode as competitors race to catch up:
- Tesla’s US market share fell from 79% (2020) to 69% in Feb 2021 – impacted by Ford’s new Mustang Mach-E.
- Volkswagen surpassed Tesla as the top-selling EV in Europe in 2020
While Tesla holds the highest driving range on the market, solid-state batteries being developed by QuantumScape could double help Volkswagen double the range of its cars.
But don’t hold your breath. Solid-state batteries are in the early stages of development and could take years to bring to market and scale production. That is if Quantumscape can ever get its tech past the prototype stage and beat other companies bringing their own battery tech to the market. For now, Tesla’s tech remains on top.
For investors… Watch your rearview, Tesla
If anyone can beat Tesla, Volkswagen may have the best shot. Being the second-largest carmaker in the world, Volkswagen’s got the scale to compete. They’ve also realized the significance of transitioning towards an electric future and shifted their investment/plans accordingly.
Learn more: In the fight for EV dominance…