Volkswagen's CEO Predicts A Rebound for Diesel

Volkswagen has been gung-ho on electric vehicles ever since it was revealed that it used illegal software on diesel vehicles to pass emission tests. The company recently unveiled plans to invest $82.5 billion into electric vehicles over the next five years. So it seems bizarre for Volkswagen's CEO to make this comment at the Geneva Motor Show.

“Diesel will see a renaissance in the not-too-distant future because people who drove diesels will realize that it was a very comfortable drive concept. Once the knowledge that diesels are eco-friendly firms up in people’s minds, then for me there’s no reason not to buy one,” said Matthias Mueller.

*record scratch*

Yes, Volkswagen's CEO sees diesel making a comeback. This is somewhat hard to believe as stronger CO2 emission regulations from the European Union start to go into effect. Various countries and cities are planning to ban diesel vehicles in an effort to cut down on pollution.

But Muller sees diesel as a way to meet emission standards until electric vehicles are more viable. 

“The rules of the game in the EU in relation to climate protection and emissions goals on CO2 are so challenging that governments cannot do without diesel. We’re doing everything to avoid” coming up short, but “if there’s less diesel, then getting to that goal just gets tougher.”

But ultimately, it will come down to consumers. Already, sales of diesel vehicles in Germany have dropped by a third. With bans looming and resale values taking a dive, consumers may look elsewhere.

“At the end of the day, consumers have the final world. We have a very clear strategy in terms of multi-energy platforms, which means we can assemble on the same assembly line petrol cars, diesel cars, electric-powered cars,” said Carlos Tavares, CEO of PSA Group.

Source: Bloomberg