Weekly News Review | 3 October 2016 | Automotive Purchasing and Supply Chain Automotive Purchasing and Supply Chain

Talking Point

VW’s silver lining

Volkswagen’s Dieselgate scandal can certainly be considered as the straw that broke the camel's back as automakers, most recently Toyota, continue to drop diesel variations. In such an environmentally-driven time, manufacturers are desperately trying to be the cleanest OEM, investing in alternative fuels like hydrogen and electricity. Up until now, diesel was hanging on in the market, being a much cleaner-burning fuel that could power large vehicles and pose strong economic benefits for drivers. However, once the ‘clean’ image was extinguished, people realised how pollutant it really was. And, following the emissions probe, diesel is on its deathbed.

Prior to this, OEMs were dipping into the world of alternative fuels, with a few examples of EVs on our roads, though they lacked range and customer desire alongside their combustion counterparts. Now, in wake of the emissions scandal, it seems automakers are putting all their energy into EVs, which was made clear at the Paris Motor Show last week; VW especially. The automaker has endured a painful 2016, with many executives around the auto group losing their jobs. It is safe to say, we will never see a diesel VW in the future.

On the other hand, this scandal could be a catalyst for VW’s future success. Take its latest I.D. Concept for example: a highly automated electric car that will cover a distance of 400-600 kilometres on a single battery charge. What is even more important than this is that the vehicle will be launched as soon as 2020, illustrating the new charge of a company that wants to put things right again. By breaking into - and hopefully dominating - the developing EV market, VW will, in the future, almost certainly see greater profit than they had with internal combustion engines. Unlike other EVs, the I.D. actually looks like a production car for the masses, stylish and futuristic but not excessive. The Tesla Model S woke the industry up to the future, but the emissions scandal has forced manufacturers to act upon it.

By being forced into EV territory, although not the first, VW has the chance to take a strong position in future mobility, with a relatively empty market to exploit. Whilst rivals will continue to push out now-favoured petrol cars, VW must electrify its brand as soon as possible. In a matter of years, the EV market will be overcrowded, as pioneers count their fortunes.

Alex Kreetzer

Alex Kreetzer - News Editor

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