Volkswagen launched a new US-based unit that will manage $2
billion in investments in zero emission vehicle infrastructure
and awareness programs for the next decade on Tuesday as part of
a court settlement on its excess diesel emissions.
The world’s largest automaker by sales said the unit plans to
install more than 500 charging stations nationwide, including
more than 300 stations in 15 metro areas. It will also develop a
high-speed, cross-country network consisting of more than 200
stations for electric vehicles. Volkswagen said it has not
decided on a business model for its charging stations.
Volkswagen will also launch a “Green City” initiative in a
yet-to-be-identified California city to pilot future concepts,
including potentially a shuttle service composed of zero emission
vehicles, an electric car-sharing program, or a zero
emissions transit program.
Volkswagen named long-time auto executive Mark McNabb as chief
executive of Electrify America. McNabb has overseen the diesel
settlement program and will continue to do so in his new role.
“It is a very fast and furious project,” McNabb said in an
interview, adding that the push to expand EVs is “an opportunity
to transform an industry. How many times in life do you get that
The company will make four $500 million investments every 30
months and must get approval from the California Air Resources
Board and the Environmental Protection Agency for spending.
Volkswagen must submit draft plans to regulators on the first
funding plan by Feb. 22.
The Electrify America unit, based in Reston, Virginia, is a
wholly owned subsidiary of Volkswagen Group of America and is
separate from Volkswagen’s automobile brands. It initially
expects to employ around 40 or 50 people in the first few years,
but it will also use outside contractors, McNabb said.
The German automaker’s settlement on excess diesel emissions from
nearly 600,000 U.S. vehicles requires that $800 million be spent
in California and $1.2 billion be invested throughout the rest of
the United States.
In December, California said Volkswagen agreed to add at least
three additional electric vehicles, including an SUV, in the state by 2020 and
must sell an average of 5,000 electric vehicles annually through
2025 in the state.
Funds spent on education and outreach must be brand neutral and
cannot feature Volkswagen vehicles. Charging stations must be
accessible to all vehicles.
Volkswagen halted sales of diesels in the United States in late
2015 and has said it has no plans to resume U.S. diesel sales.
Volkswagen is set to plead guilty on Feb. 24 to three felony
counts as part of a plea agreement with the U.S. Justice
Department to resolve charges it installed software in U.S.
vehicles to allow them to emit excess pollution.
In total, Volkswagen has agreed to spend up to $25 billion in the
United States to address claims from owners, environmental
regulators, U.S. states and dealers, and offered to buy back
about 500,000 polluting vehicles.