PremiumVolkswagen AG is selling a small portion of its ownership in Electrify America, the firm it founded to provide charging stations for electric vehicles in the wake of the diesel emissions disaster, to Siemens AG.
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A small portion of Volkswagen AG's ownership in Electrify America, the business the German automaker created in the wake of its diesel-emissions debacle, is being sold to Siemens AG.
“With our additional investment in Electrify America, we are giving e-mobility in North America a further boost," Thomas Schmall, head of VW components group, said.
The financial boost will assist VW in achieving its objective of operating 1,800 facilities and 10,000 fast chargers for electric vehicles in North America by the year 2026, which is a doubling of the current amount.
The network is now valued at $2.45 billion, thanks to the partners' combined investment of $450 million, the companies said in a joint statement on June 28. According to those with direct knowledge of the situation, Siemens' investment represents an approximately 10% ownership in the business and comes with a board seat.
According to the Department of Energy, Electrify America has more than 3,500 charging ports at 807 stations across the US and Canada. Additionally, the network has agreements for charging electric vehicles with Ford Motor Company and Hyundai Motor Company. The Wall Street Journal previously claimed that a stake sale and investment between VW and Siemens was imminent.
Volkswagen, which is attempting to increase its meagre market share in the US, is driving the industry's strongest drive toward electrification. In 2017, as part of a legal settlement with US authorities over the company's misrepresentation of the emissions levels in its diesel engines, the automaker committed to investing $2 billion in infrastructure and other initiatives to support the adoption of zero-emission vehicles. To this end, Electrify America LLC was established.
Siemens has been investing in new technologies and software in a bid to boost margins with digital services, and has been selling non-core businesses as part of that process. The German industrial giant earlier this year said it’s spending $54 million at its electrical infrastructure hub in Grand Prairie, Texas, to make EV charging equipment.
In June, Siemens also invested $25 million for a minority stake in WiTricity, a US-based company offering wireless charging solutions for electric vehicles.
(With agency inputs)