VW Will Spend Billions on Gas Engines

The money will be used to "keep our combustion cars competitive."

By: Adrian Padeanu

Jun 7, 2024 at 4:39am ET

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It's fair to say the transition to EVs isn't going as some automakers had projected. Several car manufacturers are delaying their lofty goals to become purely electric in the foreseeable future. Of the €180 billion ($196 billion) set aside in 2023 for research and development, the German brand said it would use more than two-thirds on "electrification and digitalization."

Arno Antlitz, the Chief Financial Officer and Chief Operating Officer at the Volkswagen Group, has now clarified where the remaining third will be spent. The company intends to invest roughly €60 billion ($65 billion) to "keep our combustion cars competitive."

Speaking at an event held by Reuters in Munich, the CFO and COO added that "the future is electric, but the past is not over. It is a third and it will stay a third." As a reminder, the previous plan announced in late 2022 mentioned VW would go fully electric in Europe from 2033.

Last year, VW brand boss Thomas Schäfer referred to ICE as being "old technology" in the context of e-fuels. He described the discussions surrounding synthetic fuels as being nothing more than "unnecessary noise." That's despite the fact fellow VW Group brand Porsche is actively involved in producing synthetic fuel at a factory in Chile.

Other high-end marques from the VW empire are also keeping a close eye on how sustainable fuels evolve. Bugatti is even thinking of designing fuel stations that could be installed at the owner's home and filled up with synthetic fuel. Lamborghini believes the combustion engine could be saved by making it run on something other than fossil fuels. Bentley is also exploring nearly carbon-neutral fuels.

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Speaking of the Crewe-based marque, Bentley has pushed back its objective to become EV-only by 2030, delaying it by three years. Similarly, Ford no longer thinks it can go entirely electric in Europe by 2030. Aston Martin recently reversed course as well and will continue to produce cars with combustion engines into the next decade.

It's clear that more and more car companies are reevaluating their EV strategies as people aren't willing to let go of ICE just yet. Automakers are in quite a predicament because emissions regulations are getting tighter, requiring investments to make gas engines run cleaner. At the same time, the electric offensive from China is a cause for concern for global players.