Volkswagen’s $11 billion bid to build electric cars follows a major scandal last year where the Obama administration caught the automaker cheating on emission rules in its line of diesel cars.
Company CEO Matthias Mueller said Thursday that the company will introduce a whopping 30 models of electric car by 2025.
Matthias says the goal will be to sell 2 to 3 million of the plug-in cars per year.
It is not clear how the the electric cars will help the automaker as it works out a deal with the Environmental Protection Agency in federal court over its diesel emissions cheating. Matthias did not discuss the settlement agreement that will cost the company billions.
It may be that the investments in zero-emission vehicles covers a wealth of sins committed by cars that do have emissions.
The automaker was caught last year by the EPA using a “defeat device” in its fleet of diesel cars to cheat on emission standards set by the federal government and California. The device, which is actually software, turned off emission controls when the cars were being driven. The software activated the emission controls only when the cars were undergoing testing.
The cheating scandal is still making its way through the courts and is expected to cost the company $18 billion. The company’s focus on electric cars will cost the company $11 billion to implement.
The EPA and Volkswagen reached a preliminary settlement agreement in federal court in April over the violations. The deal must be finalized by June 28, ahead of a hearing at the end of July in a federal court in California.
U.S. District Judge Charles Breyer on Wednesday extended the deadline to finalize the deal from June 21 to June 28, giving the company and regulators one more week to hash out the final details.
The preliminary settlement includes a green technology improvement fund as one way to compensate for the diesel emission violations. Thursday’s electric vehicle announcement could be a sign of the company’s willingness to abide by the agreement or to potentially replace the clean-tech fund with the new electric car targets.
The settlement also handles how VW will fix the nearly half-a-million diesel cars that contain the defeat devices and how it will compensate customers.
The electric car bid would also put it on track to meet increasingly stringent EPA fuel efficiency and greenhouse gas reduction targets that go into effect next year.
