Automakers are pouring billions into electric vehicle development and we’re already starting to see the fruits of their labor. The latest advance comes from Volkswagen, which has introduced their new APP550 drive unit.

Designed to offer higher performance and improved efficiency, the APP550 will be launched in the fourth quarter. It’s slated to produce 282 hp (210 kW / 286 PS) and around 406 lb-ft (550 Nm) of torque – depending on the vehicle’s gear ratio.

Volkswagen says the improved performance can be chalked up to a variety of different factors including an “enhanced stator with a higher effective number of windings and a larger wire cross-section.” The company also used a more powerful magnet and reinforced the unit to “withstand the considerable torques produced.”

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Engineers didn’t just focus on performance as they also paid attention to efficiency. As part of this effort, they “optimized a number of components in the powertrain, including the thermal management system.”  In particular, the powertrain features a cooling system that doesn’t rely on an electrically driven oil pump.

Instead, “heated oil is cooled by the vehicle’s coolant circuit, which keeps the drive at operating temperature.” Volkswagen also noted the outside of the stator is equipped with a heat sink.

We’ll likely hear more about the APP550 later this year, but Volkswagen said the drive system will be produced at their Kassel plant. It’s expected to be used in the ID.7, which debuts on April 17th.