Volkswagen CEO says sees case for building own battery factory: paper

November 20, 2016 8:03 AM EST

Volkswagen CEO Matthias Mueller, gives a speech during the Handelsblatt Automotive Summit 2016 in Munich, southern Germany, November 9, 2016. REUTERS/Michael Dalder


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FRANKFURT (Reuters) - Europe's largest carmaker Volkswagen sees building its own factory to make electronic vehicle batteries as a logical move as it expands production of low-emission cars after its emissions scandal.

Volkswagen and its labor unions agreed on Friday to cut 30,000 jobs at the core VW brand in exchange for a commitment to avoid forced redundancies in Germany until 2025.

The cuts came with a management pledge to create 9,000 new jobs in the area of battery production and mobility services at factories in Germany as part of efforts to shift toward electric and self-driving cars.

"If more than a quarter of our cars are to be electronic vehicles in the in the foreseeable future then we are going to need approximately three million batteries a year," Chief Executive Matthias Mueller told Frankfurter Allgemeine Sonntagszeitung. "Then it makes sense to build our own factory."

Volkswagen currently relies on external battery suppliers for the electric vehicles it makes.

Mueller said that Volkswagen has been in talks with ride-hailing service Uber on potential cooperation but the carmaker would not settle for the role as a mere supplier.

"They (Uber) saw us more in the role of a supplier. But we said: Okay guys, this is a contest which we are happy to take on. We will remain in command," Mueller said.

Automakers like VW are developing electric vehicles and billing themselves as mobility companies that don't merely sell cars but also get involved with alternatives to conventional car ownership such as ride-hailing.

Mueller confirmed that Volkswagen had set aside 18 billion euros ($19.1 billion) to cover the cost of its diesel emissions cheating scandal.

Volkswagen does not expect the German government to make tax demands to cover any revenue losses related to the scandal, a company spokesman said on Saturday.

(Reporting by Arno Schuetze; Editing by Keith Weir)



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