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Volkswagen Bets Big on Batteries to Slash Prices

Volkswagen Power Day 2021

The Volkswagen Group brought forward its plans for batteries and charging at its first Power Day. Similar to Tesla’s Battery Day event, Volkswagen has set some big targets to significantly reduce the complexity and cost of batteries in order to make the electric car attractive and viable for as many people as possible. At the same time, the Group is aiming to secure the supply of battery cells beyond 2025. In Europe alone, six gigafactories with a total production capacity of 240 GWh are to be established by 2030 – enough power pack for 3.3 million entry level ID.3 vehicles..

Their announcements were mainly targeting Europe, but their announcements will positively impact the EV industry across the globe.

Perhaps the biggest is that they are looking to deliver major cost savings from next year onwards

Volkswagen is striving to make significant advances with the battery system including all of its components right through to the cell. “We aim to reduce the cost and complexity of the battery and at the same time increase its range and performance”, says Thomas Schmall, Volkswagen Group Board Member for Technology. “This will finally make e-mobility affordable and the dominant drive technology.” Aside from the planned in-house production, significant cost benefits are expected primarily thanks to the new unified cell. It is set to be launched as of 2023 and will be installed across brands in up to 80 percent of all electric vehicles in the Group in 2030. Further savings will be delivered by optimising the cell type, deploying innovative production methods as well as consistent recycling. Volkswagen is thus aiming to gradually reduce battery costs in the entry-level segment by up to 50 percent and in the volume segment by up to 30 percent. “We will use our economies of scale to the benefit of our customers when it comes to the battery too. On average, we will drive down the cost of battery systems to significantly below €100 per kilowatt hour. This will finally make e-mobility affordable and the dominant drive technology”, says Thomas Schmall.

Advances in storage capacity and fast-charging capability are expected in addition to cost benefits. The new prismatic unified cell also offers the best conditions for the transition to the solid state cell – the next quantum leap in battery technology, which Volkswagen anticipates for the middle of the decade.

Besides the batteries, Volkswagen is also investing in the charging network globally, mainly in Europe, China and the US – no mention or plans for the Middle East just yet.

Volkswagen’s Vehicle to Grid Plan

Almost every manufacturer now are turning to the vehicle to grid technology. Volkswagen intends to integrate the electric car in private, commercial and public energy systems in the future. This will allow green electricity from the solar energy system to be stored in the vehicle and fed back into the home network if needed. Not only will customers be more independent of the public power grid, they will also save money and reduce CO2 emissions. Models based on Volkswagen’s own MEB platform will support this technology from 2022. Volkswagen will also offer a complete package with all modules and digital services – from the bidirectional wall box to energy management. The technology is soon to be used also on a larger scale – for example in residential buildings, businesses or in the general power grid.

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