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How a chocolate bar becomes a power bank

Volkswagen is driving e-mobility forward more consistently than any other automaker. Volkswagen Group Components plays a key role in this. An interview with Thomas Schmall, Chairman of the Board of Management.

Interview with Thomas Schmall, Chairman of the Board of Management

To ensure that the new Volkswagen ID.3¹ can roll off the assembly line as planned, from the end of 2019, vehicle production in Zwickau requires a whole host of components. Many parts are manufactured and supplied directly by Volkswagen Group Components. Thomas Schmall, Chairman of the Board of Management of Volkswagen Group Components, on the role of components in Volkswagen’s electric offensive.

Mr. Schmall, you once said: “Joint responsibility for the launch of the ID.3 is both an obligation and an impulse.” It’s a huge commitment, isn’t it?

We are delighted that Volkswagen Group Components is so strongly involved in the production of our new electric flagship. The successful launch of the ID.3 is a milestone for our company, and Volkswagen Group Components is supplying essential components for this vehicle. On the other hand, it is of course also a great responsibility. With innovative components, we want to make our contribution to the new ID. generation of vehicles and to the breakthrough of e-mobility. This is what drives our colleagues at our plants, in Brunswick, Kassel, Salzgitter and internationally.

The components business has only been an independent brand since January 2019. How satisfied are you with the development to date?

We are a very young brand, correct, but of course we have been represented by this element in the Group for a long time. With this realignment, Volkswagen Group has strengthened our position – enabling us to manage capacity utilization and product portfolios across brand and country boundaries and to systematically leverage synergies. As an in-house supplier, we supply engines, transmissions, electric powertrains, steering systems and seats, among other things. With around 80,000 employees in over 60 component plants worldwide, we develop and manufacture vehicle components. This makes our unit one of the world’s largest suppliers to the automotive industry. We have systematically aligned the Group’s components across all brands, thereby strengthening our competitiveness. Thanks to our vertical range of manufacture and product strengths, we measure ourselves against the best in the competition.

How important is electric mobility to you?

We are sharpening our e-mobility profile not only for the ID.3, but for all of the Group’s e-vehicles: this year and next year alone, 870 million euros will be invested Group-wide into the production of e-components. In total, we are investing 3.8 billion euros in the production of e-components until 2023 as part of the current planning round.

So, the transformation is already well underway?

This topic occupies us like no other business unit. We are in the midst of restructuring our plants, supplementing new areas of development, optimizing production and training our employees. We know that in our core business we have a business model that is only partially future proof: the combustion engine. Even though it will still play an important role until 2030, we must proactively prepare ourselves early for the enormous transformation process. Central goals are: By improving returns, we can finance investments in e-mobility, further enhance our competitiveness with optimized product portfolios and offer our employees secure jobs for the future. This is only possible if everyone pulls in the same direction and performs just as well in the conventional field as well as in e-mobility.

What is the current relationship between components for combustion engine vehicles and electric cars?

Vehicle components such as engines and transmissions, steering systems, axles and seats are essential pillars of our success. In 2018, we produced more than ten million conventional vehicle engines and over eight million transmissions. At the same time, we are transforming our unit with further activities in the growing field of e-mobility, thereby securing our product portfolio for a successful future. Group Components already manufactures electric motors and battery systems for the Group’s various brands. And we will massively increase these capacities in the coming years. In addition, we have developed a cross-brand ramp-up strategy for the production of electric powertrains, which we will now implement in cooperation with Audi, Porsche, Volkswagen and other Group brands.

Thomas Schmall, Volkswagen Group Components CEO in the Volkswagen TV studio during the IAA

The Kassel plant has assumed a key role for the electric drive of the ID.3. What does this look like in practice?

In the future, Kassel will primarily manufacture electric drives for the modular electric drive matrix (MEB). Together with parts from the Salzgitter, Poznań and Hanover component plants, all components will be assembled at the Kassel location to form the electric powertrain. Kassel also manufactures the electric powertrains for all MEB vehicles for Europe and North America. Production of the pre-series drives has already started successfully, and in future up to 500,000 units per year will leave the plant. Kassel is cooperating closely with our Chinese plant in Tianjin, where the electric drive system for the Chinese market is produced in parallel. Together, the two plants will produce up to 1.4 million electric propulsion units per year from 2023. Volkswagen Group Components will thus be one of the world’s largest manufacturers of electric powertrains for vehicles in the future.

What other components do your plants deliver for the ID.3?

In addition to the electric motor, load-bearing components and body parts for the ID.3 are also manufactured in Kassel: Parts of the ultra-strong frame for the battery box, damper mounts, cross beams and the tunnel. The Kassel platform parts are then assembled into the finished vehicle body at the Zwickau plant. Another important supplier of ID.3 is the Salzgitter components plant, which has specialized in the production of rotor and stator, two elementary components of the electric drive system, in addition to conventional engine production as part of the transformation to e-mobility. In addition to gasoline, diesel and CNG drives, up to 2,000 rotor and stator units per day will be produced here in the future. In order to realize these high quantities, a new Hairpin technology developed in-house will be used in stator production. This enables improved performance data with shorter production times.

And then there is the plant in Brunswick ...

Right, this is where the battery system for the ID.3 is manufactured. Especially for the production of the battery system – which looks like a chocolate bar on the outside – we are currently building a new hall, the size of nine football pitches. Around 2,000 battery systems will be produced here every day and delivered to Zwickau. In addition, various chassis components such as front and rear axles or the steering system will also be supplied from Brunswick.

Are you bundling the whole issue of batteries at the Brunswick site together?

At several locations. In Salzgitter, developers and production planners at the Center of Excellence (CoE) are already building up sustainable battery cell expertise for the Group. Battery systems for all brands of electric vehicles based on MEB, will in future, be developed and produced at the Brunswick components plant. The Group is also responsible for the final recycling of components. In 2020, a pilot plant will be opened in Salzgitter, where the recycling process for high-voltage batteries will be further developed. Processes that have already been researched will be adopted in order to validate the technology and economic efficiency, for series production.

Finally uncovered: The ID.3 at the IAA
¹ The vehicle is not yet offered for sale in Europe

Before the batteries in the ID.3 are recycled, following the end of their use, they continue to have a “Second Life” ahead of them. What is behind this “reincarnation”?

The expensive part of the cell lies in the raw materials. A battery cell has a life cycle of eight or more years in the vehicle, depending on the customer’s charging and driving behavior. Then you have to think about what to do with the cell. One possibility is the so-called “Second Life” process. We use the cells and the battery system – the mentioned chocolate bar – for the charging infrastructure and storage systems, for example in our flexible fast-charging column. And after a certain period of use, the recycling process follows, during which we can recover the raw materials.

You have already presented a near-series study of the flexible fast-charging column – what will it be able to offer?

Our flexible fast-charging column works according to the principle of a power bank, such as those used by millions of people for their smartphones while travelling, only much larger and more powerful. The charging capacity is up to 360 kWh. Thanks to DC rapid charging technology with a charging capacity of 100 kW, the batteries of the electric vehicles are charged in the shortest possible time.

Where could this charging column be used?

With its compact dimensions, it can be set up wherever there is a temporary need or no charging infrastructure yet – whether in the city, at festivals, at stadiums or other events, wherever that might be. Up to four electric vehicles can be charged simultaneously, either connected to or independent of the power grid, two of them via DC fast charging. Connected to the mains, it becomes a fixed charging point and the battery pack recharges itself permanently. The first fast-charging columns are currently set up in Wolfsburg, as part of a pilot project.

Is this just an experiment – or a new market segment?

It is a new business area within Group Components. We know that we cannot cover all employees with e-mobility alone, which is why we also need new fields of activity. But fast-charging columns are also a good example of the fact that Group Components, within the Volkswagen Group, is aware of all the key value-added steps of the battery. We have assumed end-to-end responsibility for the battery for the Group – from building up competences for cell production, to recycling and thus returning raw materials to the manufacturing process. A final word on the fast-charging column: If charging takes place with electricity generated from renewable sources – such as solar or wind energy – this will enable sustainable electricity to be temporarily stored for the first time. This makes electromobility CO₂-neutral. The charging station is thus also a good example of how we are transforming the Group’s components business and positioning ourselves for the future.

Fuel consumption

1 ID.3 - The vehicle is not yet offered for sale in Europe