Its future depends on the response.
Volkswagen was one of the first legacy automakers to fully understand the situation Tesla created. The California-based (soon to be Texas-based) company proved back in 2012 with the Model S that EVs can be sexy, tech-packed daily drivers. Not long after came Dieselgate and everything changed for VW. Not letting a crisis go to waste, VW shifted gears completely and dedicated itself to an electrified future. Its many brands are doing the same. That's all fine and good but VW Group CEO Herbert Diess still isn't satisfied.
In fact, he's given a new warning to the company's supervisory board in a meeting last month, according to Reuters. His bottom line is this: if the company doesn't move fast enough in its transition to EVs, up to 30,000 jobs could be lost.
One key reason is that Tesla is entering the German market at full speed; its new Gigafactory in Berlin is nearing completion. Tesla plans to build 500,000 EVs annually in Germany with a 12,000-member workforce. VW, by comparison, has 25,000 employees building only 700,000 vehicles yearly at its Wolfsburg facility. That's a big problem. Tesla can build more with less. Plus, it has wide name recognition as the EV market leader.
As expected, the VW workers' council dismissed Diess' statements as "absurd and baseless" but that doesn't mean he's wrong. Unions in Germany and elsewhere, including the US, are greatly concerned about the impact EVs are going to have on their workforces.
EVs require fewer parts than their combustion-engine counterparts, meaning fewer workers will be necessary to build them. Factory automation (i.e.: robots) is another concern. Wolfsburg, which happens to be the world's largest car-making factory with 50,000 employees, doesn't even build EVs right now. The new ID.4, for example, is assembled in Zwickau, Germany. That will change come 2026 when VW's super-secret "Project Trinity" EV sedan enters series production.
Above all, VW wants to become the world's biggest producer of EVs by 2025. It's not an easy goal and Diess is clearly well aware that time is not on his or VW's side.