Volkswagen will keep up with Tesla, says CEO Herbert Diess

Volkswagen CEO Herbert Diess on Thursday said he was confident that Volkswagen could keep up with Tesla Inc, but also said this would need further cost cuts, including headcount reductions at its plant in Wolfsburg.

Tesla is planning to open its plant in Gruenheide near Berlin, which would be its first gigafactory in Europe.

Diess said the site was setting a new standard when it comes to productivity, speed, and lean management.

Earlier this month, Tesla CEO Elon Musk addressed Volkswagen executives through video link after being invited to do so by Herbert Diess. Musk’s appearance was confirmed by Diess on Twitter and LinkedIn.

“I very much appreciate it that he showed up — I think we had a nice dialogue,” Diess, said to CNBC’s Julianna Tatelbaum.

“And we have to accept that Tesla sets the new benchmarks [on] … the EV side,” Diess said.

“Not only technology-wise but also when it comes to productivity, speed … I think it’s always good to have competition.”