Volkswagen Is Building Its Own Gigafactory Because It Thinks It Can Outdo Tesla

Electric Car

This will get interesting since VW also has more experience than the baby EV automaker.

Tesla and Volkswagen don't have much in common. In fact, one of the only things we can think of is that both are working on new factories that will build batteries to power the EVs of tomorrow. The main difference between the two is that Volkswagen is Europe’s largest automaker, so it is highly established and has plenty of experience to pull off such a large move. Tesla is a household name but still a very young company. As the Model 3 release date nears, competition is heating up.

That being said Tesla is ahead on the build process for its Nevada-based Gigafactory. Meanwhile, Volkswagen is still in the planning phase. The German automaker is eyeing China, the world’s largest auto market, for its factory. This could prove to be advantageous since China is making hard attempts at electrifying all cars on its roads in attempts to clean its heavily polluted air. VW plans to kill 40 gas-powered models and sell 30 electric models within the next decade for a total of 3 million EVs a year. This would require six times the global supply of automotive battery capacity that is currently available, hence the need for its own Gigafactory. But how does VW expect consumers to quickly adopt EVs on such a large scale?

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According to its global sales and marketing boss, Jurgen Stackmann, the “tipping point” at which EVs will become attractive to most everyday consumers will be a range of 180-280 miles per charge. Currently, 45% of VWs sold today are diesels with the other 55% being gas-powered. Aside from Mercedes’ ambitious new engine, the machinery available to make diesels cleaner is hitting a wall. As such, we may see diesel begin to die. When that happens, “the electric mix could basically become the same as diesel today,” Stackmann told Autocar. As VW begins to pay billions to settle Dieselgate, billions more will be invested in the battery factory to ensure that a gasoline alternative will keep the company afloat in the future.

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