German auto giant Volkswagen AG (NASDAQOTH:VLKAY), which is busy gearing up to produce electric vehicles by the millions, just previewed yet another new all-electric model -- but this one won't be showing up at dealers.
That's because the newest member of VW's all-electric "I.D." sub-brand is a race car. The VW I.D. R Pikes Peak, as it's somewhat awkwardly named, will compete in this year's Pikes Peak International Hill Climb, an event in which cars compete for the fastest time up a mountain road in Colorado.
VW isn't planning to sell its new electric race car, of course. But it's still important to the company's electric-vehicle effort. Here's why.
Aiming at an electric racing record
Aside from the fact that it runs on batteries and has four-wheel drive, we don't know much about the I.D. R Pikes Peak car itself yet. But we know that veteran driver Romain Dumas will pilot the car at the Pikes Peak event on June 24, and it's very likely that VW will give us more details about the car between now and then.
We know one other thing: Dumas and VW will be aiming to break the record for an electric vehicle at Pikes Peak. The record is held by race driver Rhys Millen, who made the trip up the mountain in just over 8 minutes and 57 seconds in 2016.
When he set that record, Millen was driving a one-off racer with a 50 kilowatt-hour battery, 7 electric motors, and a total of nearly 1,600 horsepower. (Imagine trying to control that beast at full speed on a twisty mountain road, and you'll have an idea of what Pikes Peak is about.)
Expect this VW's specifications to be in that neighborhood, if not even more extreme.
Why is VW doing this?
I can think of three good reasons why VW might have decided to spend the money on this adventure.
First, it's a way to begin marketing the I.D. sub-brand to auto enthusiasts. The first production VW I.D. vehicle won't appear until next year, but marketing the brand to car nuts now will help to build broader awareness: Auto enthusiasts are often the folks that others ask for recommendations at car-shopping time.
Second, while Tesla has shown that electric vehicles can be fast, fun, and desirable, it hasn't (yet) put forth a factory racing effort of any kind. By entering this vehicle in a race that will also be contested by internal-combustion vehicles, VW is furthering the idea that battery-powered vehicles can hang with -- or outperform -- gas-burners. Such efforts will help speed adoption of electric vehicles over time.
Third, racing will help VW design better electric vehicles. Specifically, it will help the company's engineers learn how their EV technology performs at the extremes. Will the battery pack overheat? Can the motors handle the strain of a nine minute full-speed run? If there are any failures, the engineers will learn from them -- and if not, they will know that they've designed a robust system.
The old automakers know that racing pays benefits
VW isn't the only global automaker planning to go racing with battery-electric vehicles. Tata Motors' (NYSE:TTM) Jaguar Cars, which will begin shipping its all-electric I-Pace this fall, will also launch an all-I-Pace racing series as a support event to the popular electric FIA Formula E series. It will be the first racing series focused on electric production vehicles -- and while the drama might be limited by the fact that all of the racers are I-Paces, think of what Jaguar's engineers will learn from this series.
The truth is, VW's electric racer isn't likely to make a major impression on the car-buying public even if it wins. But it's still important to VW's long-term goal of selling millions of electric vehicles a year by 2025. Hopefully, other automakers will step up with similar battery-powered racing efforts before long.