By Fortune Editors and Reuters
November 17, 2017

Volkswagen’s supervisory board is set to sign off Friday on a five-year spending plan totaling more than 70 billion euros ($82.5 billion) to transform the group into a leader in electric cars, a person familiar with the talks told Reuters.

Approving the plan will underline VW’s seriousness about transforming itself in the wake of its “dieselgate” scandal, offering a more concrete plan for the future that may appease its powerful unions as it struggles to cut jobs and reallocate resources.

The company itself declined to comment, but it has already said it will invest more than 20 billion euros in electric mobility by 2030, including costs to develop more than 80 new electrified models by 2025 and upgrade factories.

A large part of that investment will be made in China, the world’s biggest market for electric cars, and one that has already decreed a minimum sales quota of 10% electric, hybrid or other low-carbon powered cars in 2019. That quota rises to 20% by 2025.

Read: If You Think Electric Cars Will Save the Planet, Think Again

VW’s China CEO Jochem Heizmann told the Financial Times Thursday that the investment will enable it to release five electric-car models in China every year through 2025. Production is set to begin in the first half of 2018, at a new joint venture with Anhui Jianghuai Automobile Group (JAC Motors) and at JV with existing partners; state-run Shanghai Automotive and and FAW Group.

Until it admitted two years ago to cheating on U.S. diesel emissions tests, VW had been slow to embrace electric cars and self-driving technology.

But the emissions fraud has prompted a strategic shift to zero-emission and self-driving technology with VW now pledging to offer an electric version of each of its 300 group models by 2030.

Read: Tesla Reaches Deal to Build Factory in China

The cost of Dieselgate ($23 billion and counting in financial penalties, and untold repetitional damage) has combined with the electric-car offensive to stoke tensions at the heart of the VW group between profits and jobs, and between central control and autonomy for its 12 brands.

Company sources told Reuters last month that VW managers and unions were seeking to curb competition from lower-cost stablemate Skoda, move some of its production to Germany and make the Czech brand pay more for shared technology.

Read: Top VW Manager Has Been Arrested Over His Role in the Diesel Scandal

Executives and labor leaders have also been haggling over decisions on where to build electric cars and pool related resources, complicated by the influence of Lower Saxony, VW’s home state and No. 2 shareholder where six of the carmaker’s 10 German plants are located.

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