Move over, Musk! Volkswagen & Toyota revved up to challenge Tesla’s electric car market dominance

The bosses of the world’s two largest automakers, Volkswagen and Toyota, have hit out at Tesla as they seek to challenge their US rival’s leadership in the electric car market and avoid falling into oblivion.

Volkswagen and Toyota have battled for the crown of the world’s top carmaker through vehicle sales in recent years, with the German company keeping its lead over its Japanese competitor by a small margin in 2019. Even with strong sales, both auto empires lag behind Tesla when it comes to market value, with their combined market cap more than $110 billion lower than that of Elon Musk’s company.

As most industries are shifting to more green technologies, the German and Japanese auto majors have set ambitious targets to become big names in the EV (electronic vehicle) market – the area in which Tesla has been an undisputed leader so far. There will be even more focus on climate change when the coronavirus pandemic fades, Volkswagen CEO Herbert Diess believes. And that’s an opportunity the company cannot miss if it wants to survive, he says. 

“Nokia is probably a good example of how such a change can happen – if you’re not fast enough, you’re not going to survive,” he told Bloomberg.  

Diess is confident, however, that his company is “the best prepared company for the EV age,” despite the fact that Musk is currently leading the industry.

The Volkswagen boss believes his cars have some advantages over Tesla, especially when it comes to premium quality. Last year, Volkswagen said that it wants to invest some €33 billion into its electric car program and release up to 75 all-electric models to the market by 2029. 

“We want to compete with Tesla and try to get close to and, in some areas, probably overtake. When it comes to the battle for market leadership, the race is still open,” Diess said. 

The CEO’s comments were released on the same day that his Japanese competitor held an online earnings presentation. Toyota’s president, Akio Toyoda, who is the grandson of the company’s founder, made a rare appearance at the event and didn’t miss an opportunity to take a swipe at Tesla, which he believes Toyota can beat. 

“They [Tesla] have not created a real business in the real world yet. They are trying to trade recipes,” he said about his US rival’s business.

While Toyota’s chief acknowledges the vast gap between the two firms in terms of market value, he believes his company outperforms Tesla when it comes to its variety of energy efficient vehicles and overall sales. 

“When it comes to products, we have a full menu that will be chosen by customers,” Toyoda said.

Toyota reportedly plans to sell about 7.5 million vehicles during its 2021 fiscal year, while Tesla expects to sell some 500,000 vehicles in 2020. While the Japanese conglomerate is more focused on hybrids than all-electric cars, it was earlier reported that the conglomerate wants to pay more attention to the EV market. 

“We’ve completely lost in the way we are valued by the stock market, but we’re not just standing by,” Toyoda said on Friday. “Energy conditions differ worldwide and I do think we will be chosen the most in the future since we have various offerings for electrification.” 

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