Volkswagen Boosts Electric Car Investment & Sales Goals — 22 Million Electric Cars by 2028

Is Volkswagen all in on electric cars?  The company has been saying it is for almost 2 years now as it tries to climb out of the hole it dug for itself with its diesel cheating scheme.  The secret of manufacturing automobiles in large quantities and doing it profitably is utilizing a common platform or chassis that can be the basis for several models and hopefully millions of vehicles.

The platform is like the skeleton of the car.  What we see on the outside is just cosmetics.  The platform defines such minutia as where the vents for the climate control system go so that when the cars travel along the assembly line, workers and robots can build several models with common components that go together quickly with maximum efficiency.

The major costs associated with designing new models goes into creating the platform.  After that, the more vehicles that get built on that platform, the lower the unit costs are thanks to economies of scale.  Look at it this way:  If a company spent $100 million designing a new platform and used it to build 100 cars, its unit cost for the chassis is $1 million per car.  But if it can build 10 million cars using that platform, its unit cost per vehicle is a paltry $10 per car.  That’s how you make money in the car business.

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