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Volkswagen CEO Herbert Diess warned that the shift away from Russian energy isn’t happening fast enough to shield the German carmaker from a sudden stop in natural-gas deliveries.

VW will keep the ability to run its power plants with coal instead of gas because of Germany’s reliance on Russian imports, Diess said in an interview for the Qatar Economic Forum in Doha. While progress has been made sourcing liquefied natural gas from the US and other nations, building up the necessary infrastructure will take time.

“It’s going probably not fast enough” to cope with a major disruption, Diess told Bloomberg Television’s Anna Edwards. “In the long run, I’m sure that we [will] become independent from Russian gas.”

Diess has spearheaded big changes at VW to make it more agile and challenge Tesla as the leading maker of electric vehicles. The company has introduced new battery-powered models, is moving ahead with a plan to add an electric vehicle (EV) factory close to its Wolfsburg headquarters and is building up a comprehensive battery supply chain.

While the war in Ukraine, rising interest rates and inflation all weigh on investors’ risk appetite, Diess said he’s not yet seeing demand destruction in the automotive sector. VW has EV orders lined up for “roughly one year” and is optimistic it will achieve its targets for 2022.

“We don’t see customer demand going down currently, but that might change,” he said.

EV leader

VW could overtake Tesla as the biggest EV maker in 2024, according to Bloomberg Intelligence — a projection Elon Musk contested in his interview at the Doha event on Tuesday. Diess said VW has “the widest range of EVs in the world market”.

Diess has recently fielded tough questions about issues at VW’s software unit that are delaying the release of new models. The CEO said he’s happy with the technology stack at its main VW passenger-car brand and confident that its Porsche and Audi units can iron out their challenges soon. He added that the structural overhaul at VW will require more patience.

“The build-up of software competences to a level where we are 90% self-sufficient will take decade or so,” Diess said. “We are still buying teams, companies worldwide, investing heavily in China, in the US.”

Qatar’s Ministry of Commerce and Industry, the Qatar Investment Authority and Investment Promotion Agency Qatar are the underwriters of the Qatar Economic Forum, powered by Bloomberg. Media City Qatar is the host organisation.

Bloomberg. More stories like this are available on bloomberg.com


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