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There appears to be a budding friendship between the CEOs of Volkswagen Group and Tesla, the electric-car company suddenly back on the ascent.

At an event where VW was presenting the new Golf hatchback Thursday, CEO Herbert Diess quibbled with reporters who suggested Tesla is in trouble because it's too small.

"Tesla is not niche," Diess said in Wolfsburg, Germany, where VW is based. "The Model 3 is a large-series model and they are one of the biggest manufacturers of electric-car batteries."



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