Volkswagen invested hundreds of billions of dollars in new technologies such as electric cars to catch up with Tesla.

As countries around the world set more and more stringent carbon reduction targets, the "energy revolution" of the automotive industry is also accelerating, although Tesla is currently in the lead, but a number of established car companies are not to be outdone. German car giant Volkswagen (Volkswagen) said on Thursday that it would increase its investment in electric vehicles and digital to 89 billion euros ($101 billion) over the next five years.

Volkswagen updates its five-year investment plan every year, and this year is no exception. At the group supervisor meeting held a few days ago, Volkswagen announced a five-year spending plan to catch up with Tesla. The company said it would invest a total of 159 billion euros ($180 billion) over the next five years, of which 89 billion euros would be spent on technologies such as software and electric vehicles.

Simply calculating, the share of technologies such as software and electric cars will rise to 56 per cent from 50 per cent last year, while Volkswagen pledged to spend about 73 billion euros on electric vehicles and other new technologies in 2020. This means that Volkswagen plans to get rid of internal combustion engines faster. Volkswagen predicts that by 2026, 25% of its cars sold worldwide will be pure electric vehicles. Currently, electric cars account for only 5% to 6% of Volkswagen's sales.

Hans Dieter Poetsch, chairman of Volkswagen, said, "our extremely sound financial foundation enables us to finance the necessary investments on our own." Therefore, we are also very confident that these investment decisions will lead Volkswagen to future success. "

The company said in a statement that it needed to increase investment by 2025 "mainly because the development of electric vehicles needs to be accelerated as part of a green agreement reached by the European Union".

Volkswagen also said it would increase spending on battery-powered electric vehicles by about 50 per cent to 52 billion euros ($59 billion) by 2026 as part of the group's transformation plan. the amount allocated to hybrid "transition technology" fell by 30 per cent to 8 billion euros.

In addition, the total expenditure will include new factories, such as the one at the company's headquarters in Wolfsburg, Germany. Volkswagen's Project Trinity is a new flagship electric car scheduled to be launched around 2025 and will be built in Wolfsburg. Volkswagen also outlined plans to build new facilities across Europe.

Volkswagen also plans to set up an independent battery manufacturing company. According to Volkswagen, the battery business is expected to generate as much as 30 billion euros, more than Volkswagen's Skoda passenger car division currently earns.

Although Volkswagen has always vowed to catch up with and surpass Tesla, the reality is often "bony". Volkswagen sold about 202000 all-electric (BEV), cars in the first seven months of this year, meeting only 34 per cent of its target of 600000 in the current fiscal year. Of these, 89000 are sales of the ID series, and 73 per cent of the products are sold in Europe.

There was also news that Volkswagen was considering an independent listing of its luxury brand Porsche (Porsche) to secure funding for Volkswagen's transition to electrification and intelligence. This will help Volkswagen challenge Tesla's leading position in electric vehicles.