Volkswagen CEO expects software to be 90 percent of innovation in new cars


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❝ Volkswagen will ramp up its hiring of software experts to ensure that the car and truck maker stays at the forefront of innovation in an industry geared toward refining mechanical, rather than software components…

Demand for software functions has risen exponentially as customers increasingly expect advanced driver assistance systems, smartphone connectivity and self-driving functions.

❝ “Today our 20,000 developers are 90 percent hardware-oriented. That will change radically by 2030. Software will account for half of our development costs,” Herbert Diess said.

Compared to a smartphone, a car has ten times as many lines of software code, and a self-driving car will have a thousand times that amount, Diess explained.

The carmaker needs more software engineers to program the various sensors and actuators within a vehicle, so that a self-driving car can develop the right reflexes to navigate traffic situations and avoid accidents.

When you can offer several completely different-purposed vehicles from the same essential skateboard platform, making software and top-of-the-skateboard functions do the work…you can roll out new products a lot faster and more cheaply than existing tech. Once you get up to economies of scale. Simplified platforms made possible by electrification need a few hundred parts to roll out – instead of the thousands needed in internal combustion vehicles. Simple works.

VW is tooling up 16 plants to build electric autos by 2022


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❝ Volkswagen AG secured 20 billion euros ($25 billion) in battery supplies to underpin an aggressive push into electric cars in the coming years, ramping up pressure on Tesla Inc. as it struggles with production issues for the mainstream Model 3.

The world’s largest carmaker will equip 16 factories to produce electric vehicles by the end of 2022, compared with three currently, Volkswagen said Tuesday in Berlin. The German manufacturer’s plans to build as many as 3 million of the cars a year by 2025 is backstopped by deals with suppliers including Samsung SDI Co., LG Chem Ltd. and Contemporary Amperex Technology Ltd. for batteries in Europe and China.

❝ With the powerpack deliveries secured for its two biggest markets, a deal for North America will follow shortly, Volkswagen said. In total, the Wolfsburg-based automaker has said it plans to purchase about 50 billion euros in batteries as part of its electric-car push, which includes three new models in 2018 with dozens more following.

Can’t happen soon enough for me. We haven’t even narrowed down style for the next new car in our household. Leaders on spec right now are the Tesla pickup and the VW Mini-Micro. Electric-only folks.

The Electric Vehicle Takeover


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❝ Do you want the big thing or the new thing?…More importantly: Do you want to invest in the big thing or the new thing?

It’s a question that haunts any industry vulnerable to disruption, which is pretty much all of them these days.

❝ Take the automotive business. Bloomberg New Energy Finance just released its latest long-term outlook for electric vehicles. It posits, startlingly, that sales of all-electric and plug-in hybrid vehicles will overtake those using internal combustion engines within roughly two decades…

The late 2030s may sound like a long way away. But they aren’t when put in the context of an automotive industry that’s only been around for a century or so.

❝ Looked at differently, BNEF’s projection suggests electric vehicles account for all the growth in global vehicle sales within a decade from now…

Based on BNEF’s projections, global sales of vehicles will rise by 1.67 million in the year 2026. But sales of electric vehicles are forecast to rise by 2.06 million, while the number of vehicles using internal combustion engines will fall slightly, by around 400,000. To be clear, absolute sales of electric vehicles in that year are expected to be just over 10 million, versus almost 87 million for their traditional counterparts…

❝ And while it is tough for incumbents to pivot to a new business, it is not impossible…it was critical for Facebook that, even as it was launching its IPO in 2012, it was also overhauling its business to focus on smartphones rather than its desktop PC product — despite the latter accounting for 89 percent of the company’s advertising revenue that year…

Facebook’s desktop product dominated its advertising revenue in 2012 — but all the growth potential was in smartphones.

More examples dot the financial map. VW planning on investing $10 billion into electric vehicle manufacture – mostly in the United States for global distribution. The Brits announced, today, legislation to end registration of diesel or gasoline-powered motor vehicles in the UK by 2040.

Those drops of water appearing under your front door look like the beginning of a flood to me.

VW, BMW, Ford to build charging network as part of the growing matrix of electric vehicles

❝ Ford Motor, Volkswagen Group, BMW Group and Daimler today said they plan to set up charging stations for electric vehicles along major highways in Europe. The move will be an important step toward facilitating the mass-market adoption of EVs, the companies said in a joint statement.

❝ The companies have signed an initial agreement to create the charging network in what they said is an “unprecedented collaboration.” The goal is to quickly build up a sizable number of stations in order to enable long-range travel for battery electric vehicle drivers.

The projected ultra-fast high-powered charging network with power levels up to 350 kW will be significantly faster than the most powerful charging system deployed today…

The buildup is planned to start in 2017. An initial target of about 400 sites in Europe is planned. By 2020 the customers should have access to thousands of high-powered charging points…”The charging experience is expected to evolve to be as convenient as refueling at conventional gas stations,” the automakers said.

❝ The network will be based on Combined Charging System standard technology. The planned charging infrastructure expands the existing technical standard for AC and DC charging of electric vehicles to a higher level of DC fast-charging capacity with up to 350 kilowatts. EVs engineered to accept 350 kW of power will be able to recharge in a fraction of the time as today’s EVs.

Here it comes. The historic auto truism hasn’t changed. Just about every advance in the auto craft starts in Europe.

VW cheated smog testing on almost a half-million cars

The EPA is accusing Volkswagen of illegally using software to cheat emissions standards, allowing the German automaker to sell half a million cars that produce nitrogen oxide, which creates smog, at up to 40 times the legal limit.

In a notice of violation of the Clean Air Act sent to Volkswagen AG, Audi AG, and Volkswagen Group of America, today, the EPA said diesel-powered VW cars used a “defeat device,” a kind of “a sophisticated software algorithm [that] detects when the car is undergoing official emissions testing, and turns full emissions controls on only during the test. The effectiveness of these vehicles’ pollution emissions control devices is greatly reduced during all normal driving situations.”

The accusation applies to 482,000 diesel-powered, four-cyclinder Jetta, Beetle, Audi A3, and Golf cars sold between 2008 and 2015 in the US, and to Passat cars sold from 2014 to 2015…

The White House has directed VW to recall the affected cars, and the automaker will be required to fix the problem, at no cost to car owners.

“Clean diesel,” by comparison to old standards [think drippy Oldsmobiles] works well and produces better miles per gallon figures. Some of the systems require a bit more owner management which VW may assume Americans aren’t disciplined enough to perform.

The majority of diesel-powered passenger cars in the country are sold by the Volkswagen group – which includes Audi.

Pretty sleazy.

Turbo-boosted engines becoming the norm at Ford and VW


Click to enlarge2014 Ford Fiesta Turbo ST

Despite the hiccups associated with any technology, the U.S. automaker Ford says it can see a day when all vehicles are either hybrids, electrics or powered by turbocharged engines.

Ford produced its 2 millionth EcoBoost engine Tuesday and said it plans to add to its lineup of five turbocharged powerplants, ranging from a 3.5 liter V6 to a tiny 1 liter three-cylinder engine, and may include a smaller EcoBoost V6 for the next F-150 pickup…

“Five is not the end of the road,” said Ford Vice President of Powertrain Engineering Joe Bakaj. He said EcoBoost technology would help the automaker meet the federal mileage requirement of 54.5 miles per gallon by 2025.

It was a “big risk for us as a company to go from a big V8 to a V6. We knew on paper it would be great, but until you launch and see consumers vote, you don’t know if the strategy will work,” he said Monday at the Dearborn Truck Plant in Dearborn, Mich.

About 20 percent of all new Fords have direct fuel injection EcoBoost engines, which generate the power of a larger conventional internal combustion engine via turbocharging and software while delivering improved fuel economy.

Although an EcoBoost engine is more expensive than a conventional gasoline engine it recoups the additional cost in fuel savings four times faster than a diesel engine…

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VW switches on largest solar park at a US auto factory

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This mostly is a VW press release; so, forgive the first person language. It’s still an achievement.

In December 2011, the Volkswagen plant near Chattanooga, TN was certified LEED Platinum. That’s a difficult level to reach – as we described at the time – but the one billion dollars the company spent there fit snugly into the VW corporate storyline: we’re going to make cleaner cars at cleaner plants. We’re going to reduce CO2 emissions by 30 percent (between 2006 and 2015). We’re going to make sure our production facilities are 25 percent more “environmentally compatible.” We’re going to Think Blue.

No other factory, so far, has achieved the Platinum award.”

Today, VW made good on one important piece of its LEED Platinum promise: generating its own clean energy. The huge new solar park that was turned on today was always part of the Chattanooga plan, but its official start marks one more way that VW is at the forefront when it comes to building cars cleanly…

Located just a short bus ride away from the factory, the 65-acre solar park (33 of which are the solar panels themselves) is the largest single array in Tennessee. It is also the largest solar park at a US auto factory. It is made up of 33,600 individual solar panels that together generate 9.58 megawatts of DC power (that’s at the panels, it’s 7.6 MW of AC power going into the plant) and 13.1 gigawatt hours of electricity a year. That’s 12.5 percent of the plant’s power needs. In CO2 terms, this means emissions are reduced by 6,675 tons a year, or the amount that 360 average US homes would generate.

VW currently builds the Passat in Tennessee, and last year – the first year of full operation – the company built 152,546 vehicles there, beating the target of 145,000. While most of these are sold in the US, some are exported to our North American neighbors as well as South Korea and the Middle East. The solar park is international as well, since VW partnered with Phoenix Solar, a German solar company with operations around the world, and Silicon Ranch…

Wolfram Thomas, Group Chief Officer for the Environment, Energy and New Business Areas, said today that, “All our 100 plants are to be environmentally optimized. All our plants must become 25 percent more environmentally compatible.” We look forward to seeing how this all plays out, wherever the sun shines.

Good for you, VW. Corporate monsters round the world talk a lot about environmental goals. Nice to see one put their money where their mouth is.