Why Dieselgate will be good for Volkswagen

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Diesel was already on the ropes with the advent of powerful electric vehicles, but now with the Volkswagen scandal it all but seals its fate.

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Diesel is dying. Not a slow death, but an immediate one.

Diesel was already on the ropes with the advent of powerful electric vehicles, but now with the Volkswagen scandal it all but seals its fate.

image7It’s not diesel’s fault; it’s a cleaner-burning fuel than people realize, capable of powering incredibly large, powerful vehicles. There was only one major downside: pollution. While diesel burns cleaner, it still produces carcinogens, soot and nitrous oxide, which can be just as harmful to the environment as traditional gasoline. Now it seems even “clean diesel” wasn’t so clean. It was only a matter of time before it was ushered out of the commercial vehicle space. Now it will be forced out rather unceremoniously, leaving electric to take its place.

Volkswagen has become the perfect test case for the future of the auto industry. As the leader in diesel-fueled vehicles and the second-largest automotive manufacturer in the world, VW had to pivot to a new vertical eventually. They were already in the early stages of joining the electric vehicle arms race, having announced three new EV concepts just a few weeks before the scandal broke. Now the world is different, as the ire of the nation comes down on them they need a new flagship to drive them into the future, and that’s electric.

When Tesla broke Consumer Reports’ ratings system, every major manufacturer was put on notice. When ‘dieselgate’ broke, it shook the foundation. The traditional fuels of the past are no longer a preferred solution. Electric vehicles cannot be ignored: they are the future. Over the next 3 years the once lopsided EV market is going to explode with options. Nearly every major manufacturer will debut a brand new electric vehicle line. With this new focus on EVs the companies who get an early start will be in the drivers seat.

By having to pivot now, Volkswagen is well-placed to win the future. Had the scandal not happened, VW would have slowly repositioned over time assuring their current offerings got the maximum lifespan. Now they must change direction quickly and the best market to focus on is electric. Currently, there is only one name in the mid- to high-end electric market, Tesla, and there is plenty of room for more. If VW can release a quality electric vehicle line soon, they can certainly begin to fill out that space before others have a chance. By pouring their substantial, diesel focused, resources into EVs they can move to market much quicker then before. It may not seem like it but Volkswagen isn’t totally lost. A few well-timed decisions could right the ship rather quickly.

Fossil fuels are far from done but the writing’s on the wall, electric is here to stay and Volkswagen is hurting, but it may end up being a blessing in disguise.

Source: CleanTechnica. Reproduced with permission.

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  1. Keith 4 years ago

    I think Volkswagen is already well down the EV track in China. http://www.reuters.com/article/2015/06/03/us-volkswagen-saic-production-idUSKBN0OJ2HS20150603

    It is ironic when China gets criticised for pollution, that diesel has not been successful in China. Diesel sales are reported at 0.4% of total car sales in the last 12 months. http://www.bloomberg.com/news/articles/2015-09-25/china-pushes-ahead-with-electric-vehicles-amid-diesel-scrutiny

  2. Jacob 4 years ago

    Got to disagree.

    Electric buses and trucks are waiting for battery prices to crash.

    Then there are tractors, bulldozers, cranes, etc.

    • nakedChimp 4 years ago

      disagree on what?

      The author points out a reasonable train-of-thoughts.
      It naturally is on VWs managers now to do the smart moves with time horizons of 20-30 years..

      • Jacob 4 years ago

        Disagree that diesel is dead.

        There is a thing called AdBlue. Mercedes 4WDs have them. Buses and trucks have them.

        • Coley 4 years ago

          Mebbes not dead but terminally Ill.

        • Alastair Leith 4 years ago

          there’s a think called dead end technology too. it’s over for diesel issue is just about arranging the timetable for it’s farewell.

  3. Ron Horgan 4 years ago

    I agree that VW will discontinue diesel and go electric as a matter of survival.
    The fundamental problem with internal combustion engines is that NOx levels increase with combustion temperature, and increased temperatures are essential for increased efficiency. This would even apply if hydrogen is the fuel. The problem is oxidization of atmospheric nitrogen by atmospheric oxygen.
    However VW will thrive as their car making skills , safety and handling etc are combined with the battery/electric skills of Tesla.

  4. Rob 4 years ago

    Anyone who has been caught behind a diesel truck, bus, ute, 4WD when said diesel’s fuel system is in need of a service and who has had to breathe in the black crap spewing from the exhaust pipe will not bemoan the passing of diesel. I was caught behind a bus the other day going up a hill and I had to close my window and vents to avoid breathing in the toxic cloud coming from it’s exhaust. I couldn’t help thinking at the time “if only that was an electric bus”! Dieselgate is just another nail in the coffin of fossil fuels. When is the COALition going to wake up to the demise of fossil fuels. The Great Energy Transition is happening before our eyes and the government is seemingly blind stupid.

  5. Neville Bott 4 years ago

    Electric vehicles are cheaper and simpler to build, we have a number of redundant vehicle assembly lines along with a workforce with the required skills. The vehicle industry is on the cusp of a once in a lifetime change, finance is cheap we’re transitioning from a resources boom and looking for our next opportunity.
    We are also about to become the worlds largest lithium producer is there anyone in charge in this country that might be able to see an opportunity here ?

  6. trackdaze 4 years ago

    I think diesels death is being overstated. Fact is bmw diesel breezed through the test and similar euro 6 diesels are likely to clean city air as they drive though 😉

    Yes I think its positive that vw and others are looking to electrify their vehicles. Battery technology/price/production capacity is still a couple of years away and its most likely it will be a hybridized rather than full electric. Afaik None should tut tut at this as it will get most of the benefits without having to wait a further 5-10 years for full electric when it comes.

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