Volkswagen (OTCMKTS:VWAGY) stock is a hot topic among traders on Tuesday after announcing plans to invest more money into electric vehicles (EVs).
According to the company, it will invest $192.6 billion into its business from 2023 to 2027. The company points out that 68% of this investment will be used in future fields of digitization and electrification.
Volkswagen is shifting toward EVs as it believes it will continue to take a larger stake in the consumer market. The company expects that as early as 2025 every one in five vehicles sold will be an electric one.
Oliver Blume, CEO of Volkswagen, said the following in a press release:
“FY22 was an important year for the Volkswagen Group. We made headway on executing our strategy, despite extreme headwinds. BEVs accounted for a record 7 percent share of total deliveries – a significant milestone that we will build upon this year as our popular model range continues to grow.”
What the Future Holds for VWAGY Stock
If Volkswagen is right about its bet on EVs, its investment news could result in a major return for investors. If there’s one thing worth keeping in mind, it’s that there are already several rivals in the EV space. That includes newer companies only focused on EVs, as well as legacy automobile companies switching over to EVs from gas-powered cars. That could mean tough competition for VWAGY stock in the years to come.
VWAGY stock is down 1.8% as of Tuesday morning.
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On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.