Richard Branson: VW cheating may be 'positive news'

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Billionaire entrepreneur and outspoken environmentalist Richard Branson said Monday the Volkswagen emissions scandal should be a wake-up call to automakers to invest in clean vehicle innovations instead of backward-looking, fossil-fuel-derived technologies.

"It shows they should have actually invested their money in battery-driven cars, which is the future, rather than diesel-driven cars and cheating," the Virgin Group founder said in a CNBC's "Squawk Box" interview.

"What's happened to Volkswagen is actually positive news in that hopefully the car manufacturers will do the right thing and will invest in the future."

Asked if he would buy a VW-made vehicle, Branson said: "I would want to operate a car that is clean. So I wouldn't."

On the broader debate on man-made climate change, he said, "I don't bother about the few climate skeptics anymore. The overwhelming evidence is the world has a problem unless we do something about it."

Branson is the co-founder with Jochen Zeitz of the B Team, a group of entrepreneurs invested in boosting social, environmental and economic benefits.

"Let's have fun doing something constructively about it that saves the world money and powers the world at a price that's less than today," he said. "Let's rally hundreds of thousands of entrepreneurs all over the world to do that."

Branson's golden rule for entrepreneurs

The Virgin conglomerate runs branded businesses worldwide in industries including mobile, airlines, financial services, music, health and wellness and space.

Branson said he ended up getting into the airline business because he was bumped on the flight of one of his eventual competitors.

Even though Virgin seems be into everything, he said his rule for putting his brand on a business is: Can it do what it does better than its competitors.

Private space race: Branson, Musk, Bezos

"Space was very much my own baby," Branson said. "I'd seen the moon landing and I said, 'One day I'll go to the moon.' Governments did [exclusively] run space travel. And they weren't interested in sending you or I to the moon."

Thus Virgin Galactic was born.

Last year, the commercial space travel company's SpaceShipTwo crashed during a test flight over the Mojave Desert—killing the aircraft's co-pilot and wounding the pilot.

Branson said the tragedy rattled his confidence for about 48 hours. "But talking to our engineers and our teams, seeing their commitment ... made us determined to carry on."

In addition to working on putting people into space at up to $250,000 a seat, he said Virgin Galactic is developing rockets to launch satellites to help people around the world stay connected.

Branson isn't the only billionaire in the private space race. SpaceX founder Elon Musk, also leader of electric automaker Tesla and Blue Origin founder Jeff Bezos, also head of e-commerce giant Amazon, are also reaching for the stars.

"Competition is extremely good for all of us," the Virgin leader said. "We're in a slightly different field than they are. But we'd all like to get to Mars first."

"It's a pretty friendly competition," said Virgin Galactic Vice President Will Pomerantz, sitting next to his boss on CNBC. The private companies don't share technology, but they do swap lessons on safety, he said.