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Volkswagen’s CEO says the outlook for EVs is very good

On Thursday, the CEO of German auto giant Volkswagen tried to allay concerns about electric vehicle sales and semiconductor supplies, predicting that delivery times for electric vehicles will shorten as the year progresses.

“Our prospects are very good [a] very good order intake in Asia,” Herbert Diess told CNBC’s Annette Weisbach on Thursday.

Recently, supply chain constraints, including those related to semiconductors, have become a major problem for automakers.

“We’re trying to shorten the lead time,” Diez said, “but right now we have about a year lead time, so we’re ramping up production … five assembly plants are going into production.”

Identity card. Buzz, pictured at a factory in Hanover, Germany, on June 16, 2022. Supply chain constraints, including those related to semiconductors, have recently become a major problem for automakers.

Ole Spata | Picture Alliance | Getty Images

Volkswagen shares were up 5% in afternoon trading in London. Frankfurt’s share price has fallen by more than 28% since the beginning of the year.

“We will see a ramp-up in the second half of the year to really be able to reduce the delivery times of our electric vehicles,” he added. “Demand is high in Europe as well as in the United States.”

Semiconductors, Diez noted, are still a bottleneck, but said that’s likely to change soon. “We will see an easing over the next few weeks,” he said.

Diess’ comments came on the same day his company broke ground on a cell factory in Salzgitter, Germany, and launched a battery company called PowerCo. PowerCo will be “responsible for Volkswagen Group’s global battery activities,” the statement said.

He added that in the period up to 2030, PowerCo “will invest more than 20 billion euros. [$20.4 billion] together with business development partners to generate annual sales of over €20 billion and employ up to 20,000 people in Europe alone.”

By 2030, VW says it wants at least 70% of its European revenue to come from electric cars. In China and North America, its goal is at least 50% of revenues from electric cars.

Earlier this year, VW announced plans to relaunch the iconic Scout brand as an all-electric pickup truck and “rugged” SUV, with prototypes due in 2023 and production slated to begin in 2026.

The company is also focusing on the development of vehicles such as the all-electric ID Buzz, inspired by the T1 minibus or the “hippie” van.

Learn more about electric cars from CNBC Pro

Volkswagen’s CEO says the outlook for EVs is very good

Source link Volkswagen’s CEO says the outlook for EVs is very good

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