The automaker is reportedly interested in the electric car firm's software and battery design expertise.
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While industry rumours are often met with a dead bat, Volkswagen has issued a firm denial it's interested in purchasing a shareholding in Tesla.

Sources have told Manager Magazin, Volkswagen Group CEO Herbert Diess is interested in acquiring a stake in Tesla to access its software and battery design expertise.

Although Diess is said to meet regularly with Elon Musk, Tesla CEO, the American automaker has rebuffed requests from Volkswagen for an alliance.

An unnamed high-level source said Diess would love to purchase the company outright, but believes it would be impossible to obtain the €27 billion ($44.2 billion) necessary to fund such a transaction.

As it is the Piech and Porsche families — who through their stakes in the Volkswagen Group hold significant sway over decisions at the firm — are reluctant to sign off on the purchase of a minority shareholding in Tesla.

In response to the magazine's article a Volkswagen spokesperson told Reuters: “The speculation about buying a stake in Tesla made by Manager Magazin is without merit."

In the wake of the Dieselgate affair Volkswagen has gone all-in with its electric vehicle plans. The company will launch its first mainstream electric car, the ID.3 hatch (above), at this year's Frankfurt motor show.

The ID.3's MEB platform will serve as the basis for a wide variety of new cars across many sizes and categories from its Volkswagen, Skoda, Seat and Audi brands.