Volkswagen is still embroiled in the Dieselgate scandal, owing billions in fines to governments around the world. And that doesn’t take into account the millions spent buying back the affected cars in the U.S.
Now the German automaker wants the German government to subsidize its lithium-ion battery development.
According to a report from Reuters, VW has expressed intent to take part in Germany’s Economy Ministry’s plan to fund battery cell development.
“Volkswagen group wants to take part in Economy Minister Altmaier’s initiative to support the industrial production of mobile and static batteries,” the company said in a statement.
VW is not alone, however. In total, 30 other German companies — including BMW — have applied for the subsidy program. The German plan is in conjunction with the European Union’s larger scheme to counteract Asia’s battery development. By doing so, the EU hopes to control 30 percent of the global battery market.
Additionally, the German government has set aside $1.2 billion to develop solid-state batteries. This, in order to offset any job losses incurred by the decrease in internal combustion engines.
Why do VW, BMW, and others need the government’s help? Battery development is expensive, especially due to labor costs in Germany. In order counterbalance Asian countries in which labor is cheap and governments sometimes play fast and loose with regulations in order to spur innovation, European legislators will have to free up some major funds.
In fact, the cost of battery development shuttered Daimler’s Li-Tech battery division in 2015. If Germany wants its companies to remain competitive in the battery-electric vehicle space, it is going to have to pony up and fit part of the bill.