Volkswagen and Toyota have you in their sights, with both announcing Wednesday major new investments in electric vehicles to compete against market-leader Tesla.
Chrysler, too, said it would aim for an all-electric fleet.
As environmental concerns — and high gas prices — take center stage, more people are turning to electric cars, and legacy automakers are looking to get in on the action in a bigger way — putting up a challenge to Musk’s Tesla, which has 79 percent of the EV market in the US, according to data-tracker IHS.
Now Volkswagen and Toyota plan to invest a combined $170 billion in the next few years as part of a strategy to scale up their transition from internal-combustion engines to battery-powered vehicles.
A Pew Research Center survey of Americans released in June said 39 percent of respondents reported they’d be at least somewhat likely to buy an electric vehicle the next time they’re in the market for a car or truck. The survey said about 7 percent of people currently drive an EV.
For its part, Volkswagen, the world’s largest automaker, which generates some $280 billion in revenue per year, announced a five-year, $100 billion spending plan, including investments in software development and electric technology.
Toyota, meanwhile — the world’s second largest automaker — is also revving up its production of EVs. The Japanese company, whose brand dethroned General Motors last year to become the highest-selling vehicles in the United States, is planning a $70 billion spending spree with the hope of producing a line of 30 electric vehicles by the end of the decade.
And Fiat Chrysler, which is owned by Europe’s Stellantis, plans go all-electric by 2028, the latest automaker to announce a shift away from gasoline-powered engines under rising pressure to act on climate change. Ford also has said it will increase production of its electric F-150 pickuptruck, dubbed the Lightening.
The challengers will have their work cut out for them, particularly in light of Tesla’s impressive quarterly report earlier this week that indicated a record number of vehicle deliveries.
Tesla delivered 308,600 vehicles during fourth quarter of fiscal year 2021, easily surpassing analysts’ projections. Overall, Tesla shipped 936,172 cars from its factories to customers last year — an 87 percent increase from the previous year. Both the yearly and quarterly results are company records.
Meanwhile, in October, Musk appeared to offer an olive branch to competitors when he accepted an invitation to appear via teleconference at a meeting of 200 Volkswagen executives. Musk, who is planning to open a Tesla plant in Berlin, praised VW and expressed confidence that the auto giant will make a smooth transition into the electric vehicle space.
And Tesla doesn’t appear content to rest on its laurels. It’s also planning a $188-million investment to upgrade a plant in Shanghai so that it will be able to produce more than 450,000 units per year.
Tesla’s stock, meanwhile, has surged over the past year, even as it’s stumbled so far in 2022. It’s up nearly 50 percent over the past year, though it fell on Wednesday by more than 5 percent after the news of its revved-up competitors.
Musk has seen his net worth rise sharply as Tesla’s share price has risen: His holdings rose to more than $304 billion – becoming the first person to ever reach the $300 billion milestone.
It’s not just traditional carmakers that are getting heavier into the EV game: Sony, the Japanese electronic giant, announced plans to create a new division devoted to manufacturing electric vehicles.
Sony Mobility is slated to get off the ground sometime in the spring, Sony chairman and president Kenichiro Yoshida said on Wednesday.
“With our imaging and sensing, cloud, 5G and entertainment technologies combined with our contents mastery, we believe Sony is well positioned as a creative entertainment company to redefine mobility,” Yoshida told Reuters.
Shares of Sony surged by more than 4 percent in Tokyo after the company announced plans to enter the electric vehicle space.