By Max Bernhard 
 

Volkswagen AG (VOW.XE) may have to ramp up production of electric vehicles faster than previously planned to meet tougher European Union targets to reduce carbon-dioxide emissions, Chief Executive Herbert Diess said Tuesday.

The new rules, agreed by EU member states and parliament on Monday, demand a 37.5% reduction in CO2 emissions from new cars and a 31% reduction from vans by 2030 when compared with 2021 levels. For Volkswagen, that means that 40% of its vehicles sold in Europe would need to be electric by 2030, Mr. Diess said.

"This means that our agreed conversion program, which is necessary for this system change, is not yet sufficient," he said.

The German car maker had previously expected a 30% reduction target, which is reflected in recently adopted measures, Mr. Diess said. To achieve the stricter targets, it may be necessary for Volkswagen to discontinue further combustion-engine offerings, which would entail a clearer restructuring of its plants and additional battery-cell and battery factories, he said.

"In this context, the generation of environmentally friendly electricity and the necessary charging infrastructure are also completely unclear," Mr. Diess said.

Mr. Diess said Volkswagen would revise its planning in fall 2019 to account for the target changes.

In November, Volkswagen said it would invest almost $50 billion in electrification and autonomous driving, as well as new mobility services and digitalization until 2023.

 

Write to Max Bernhard at max.bernhard@dowjones.com; @mxbernhard

 

(END) Dow Jones Newswires

December 18, 2018 12:51 ET (17:51 GMT)

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