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Who wants VW's MEB architecture?

Release Date:2019-08-10

Source: autonews.com

Volkswagen Group's decision to license its MEB electric vehicle architecture could allow the German automaker to more cheaply make EVs, but many rivals might not want to sacrifice control over such an important part of product development.

VW's top management has studied whether to share the modular front-wheel-drive architecture for months. In an interview last month with Berlin newspaper Tagesspiegel, VW chief strategist Michael Jost said licensing MEB could have far-ranging benefits.

"I believe that as far as costs and scalability are concerned, we are an industry champion," Jost told the newspaper. "That's why we intend to make the MEB accessible to our entire industry. That is a paradigm shift for us."

VW has spent or plans to spend more than $34 billion through 2023 on its coming family of EVs. By 2025, the automaker plans to offer as many as 50 battery-electric vehicles across all of its brands, compared with the six it now sells. Many of them will be based on the MEB platform, including the I.D. Crozz crossover set to go on sale in the U.S. in 2020.

MEB-based vehicles will have battery packs that will give them anticipated ranges similar to vehicles powered by gasoline internal combustion engines for roughly the same price as diesel-powered vehicles, VW Group CEO Herbert Diess has said.

The vehicles built on the MEB platform are driven by an electric motor integrated in the rear axle, which also includes its power electronics and gearbox. A high-voltage modular battery pack is built into the floor, with an auxiliary powertrain in the front end of the vehicle to provide electronic all-wheel drive.

MEB's modular design allows great flexibility in terms of size and packaging. The same platform underlies VW's upcoming Golf-sized electric hatchback, the I.D., as well as a retro-styled, three-row, electrically powered version of the brand's iconic Microbus called the I.D. Buzz.

Last month at the Detroit auto show, VW Group of America CEO Scott Keogh said the automaker would expand the company's sole U.S. assembly plant in Chattanooga to begin making MEB-based vehicles for sale in North America.

The $800 million expansion is expected to create up to 1,000 jobs and begin producing EVs by 2022, VW said. But Keogh told Automotive News last month that, at least for now, VW has no plans to build vehicles for any other automaker on the new MEB assembly line in Chattanooga.

While Jost told Tagesspiegel that VW was in "advanced talks" with competitors in the volume segment, MEB's usefulness to other automakers may be limited, said Stephanie Brinley, principal automotive analyst at IHS Markit.

"For somebody to license VW's platform, it needs to be in alignment with that automaker's strategy for electric vehicles," Brinley said.

For example, Ford Motor Co., which is forming a broad partnership with VW, may not have an interest in MEB because Ford's electrification strategy involves bigger, higher-performance vehicles.

She said other automakers also may be reluctant to essentially outsource development of EVs if they believe electric drive will become the dominant powertrain in the next few decades.

"There's opportunity for an automaker who wants to try to cut some corners on developing that technology on their own," Brinley said. But "if electric vehicles are the future, what part of that development process do you not want to own?"

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