Who Will Supply EVs For The U.S. Government? Volkswagen Volunteers

Herbert Diess wasted no time in telling Biden the VW ID.4 will be made in Chattanooga.

By: Gustavo Henrique Ruffo

Jan 26, 2021 at 8:17am ET

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If the early bird really catches the worm, Herbert Diess wants to make sure he is as early as he can be. After Joe Biden announced his intentions to replace federal government vehicles with electric cars, he said Volkswagen is ready to deliver its vehicles, but there is a catch: Biden said these cars would be “made right here in America, by American workers.”

That is probably why Diess makes sure to stress that the ID.4 will be made in Chattanooga by 2022: that would make the electric cars made by the company eligible to be part of the 645,000 EV fleet that the federal government can have in a few years. Check the tweet below:

As Tom Moloughney already mentioned in his article, the main vehicles in need of replacement are the Grumman mail delivery trucks. There are a little more than 141,000 of them around, and they are 28 years old already. The nature of their purpose and the lack of basic safety features such as ABS or airbags make them the perfect candidate, but also something that would have to be tailor-made.

GM already presented a new brand for delivery vehicles called BrightDrop. It is not unlikely that the company can design a smaller version of the BrightDrop EV600 to suit that need and win these contracts with the government. Rivian could also plan to present something that would fit the US Mail needs.

What do you think?

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While it does not seem Volkswagen would be interested in that segment (unless it could sell such a vehicle in other markets), it leaves about 500,000 cars that the company could compete to replace.

Would a German company, even producing in the US, stand a chance? If it can ensure the government that it will be able to service these cars whenever needed, that could be quite an advantage against strong competitors like Tesla. In the Nederlands, BIOS-Groep is suing the American automaker in €1.3 million for that and other issues.