Global car manufacturers are planning to invest huge sums to develop and obtain batteries and build electric vehicles (EVs) over the next five to ten years.
Company plans for investment on electric vehicles (EVs)
A recent Reuters article lists the plans and investment amounts of most companies. Global car makers will target a considerable amount of their investment on EVs on the Chinese market as the government there is providing strong incentives to change to EVs. Investment in China is expected to be more than $135 billion. The investment will include not only foreign investment but also investment by Chinese companies such as SAIC, and Great Wall Motors. However, Chinese investment may be matched or even exceeded by foreign investment often with Chinese partners.
Car makers plans total about $300 billion investment in EVs. Government policies which in many cases give incentives for buying EV's and also plan on eventually stopping the production of fossil fueled vehicles are part of the reason for the company investments. Governments want to change to EVs because of the harmful emissions caused by gas and diesel engines.
Rapid technological advances such as better batteries at lower cost have led to EVs being cheaper with longer ranges on a single charge. There have been advances too in chargers lessening charge times.
The actual spending by automakers on research and development, engineering, production and procurement will likely be much higher. The Reuters report does not include related spending by suppliers, technology companies. and other industries related to EV production — but there are several notable highlights of automakers' upcoming EV projects.
Tesla's investment
Tesla is building a giga plant in China that it will wholly own. Recently, Elon Musk, the CEO of Tesla, attended a ground-breaking ceremony for the new plant in Shanghai. Tesla has said the factory will cost around $2 billion. At the event Musk said: “We think with the resources here we can build the Shanghai Gigafactory in record time and we’re looking forward to hopefully having some initial production of the Model 3 towards the end of this year and achieving volume production next year."
Total EV investment by Tesla that makes only EVs will be $10 billion. This includes $5 billion on batteries. Of this investment $2.5 billion will be in China. Tesla has still not fully funded its huge $5 billion Nevada battery factory.
GM investment
By 2023 GM is planning to roll out 23 new EVs. By 2025 it hopes to offer electrified versions of Chevrolet, Buick and Cadillac models sold in China. With its partner SAIC in China it hopes to build EV battery modules. GM hopes to spend $8 billion combined on electrification and automation over the next several years. And GM has just revealed its new fully electric Cadillac EV.
Volkswagen/Audi/Porsche investment
VW's plans are ambitious. In December last year the company said it was planning to spend $34 billion on e-mobility initiatives and another $57 billion on battery procurement through 2025. By the same year, it hopes to have 50 fully electric vehicles along with 30 hybrids. 12 of the models will be Audis. Eventually VW hopes to have electrified versions of all its 300 models in the 12 global brands it has.
Total VW investment is a humongous $91 billion. On batteries alone VW will spend $57 billion. In China VW will spend $45.5 billion, half of its total investment.
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