The money isn't directly needed for new cars.
Volkswagen has a message for anyone with $1 billion to spare: would you consider investing that money in its electric vehicle charging infrastructure division, Electrify America? According to Reuters, sources familiar with the matter claim the automaker is seeking a co-investor that will pump in at least that stated amount. This also means VW wants to sell a stake in the division.
The German-based automaker created Electrify America as part of its settlement agreement with the US government as a consequence of the Dieselgate scandal that erupted in September 2015. The deal called for the company to invest some $2 billion in the EV charging infrastructure instead of paying additional fines. It was the cheaper solution at the time but VW has continued to invest more money into the network since then.
That's anything but cheap, so having a co-investor at this time makes sense. Beginning in 2017, Electrify America aimed to invest some $2 billion through 2026 to expand its network of charging stations across the country. As of now, it has 635 stations, and many more are planned. Launching and selling EVs like the new VW ID.4 is only part of the electrification equation; a vast charging network is also vital.
Tesla understood this perfectly from the beginning and that's why its US network already has over 900 stations. VW knows it needs to play catch up and is right now working with Citi to find a co-investor. Electrify America declined to comment on the report.
By the end of this year, it plans to have close to 800 DC charging stations up and running with over 3,500 individual chargers at those stations. It'll be interesting to find out who VW and Citi are approaching for the money. Could it be tech companies, or possibly fellow automakers?
General Motors or Ford might be potential partners as both are firmly committed to EVs. VW already has a separate deal with Ford that involves commercial vehicle and truck platforms while the Blue Oval will gain access to the MEB platform in Europe for a new EV crossover. If there is an investor to be found, there's a decent chance an official announcement will be made by the end of the year.