Volkswagen Plans to Launch Sub-$35,000 EV in US or Mexico Within 3-4 Years

Volkswagen eyes localizing assembly of battery packs for new EV to qualify for U.S. tax incentives, competes with Tesla and Volvo by offering an affordable electric vehicle option.

• Volkswagen aims to launch a sub-$35,000 electric vehicle (EV) in the United States or Mexico within three to four years in a bid to provide a competitively priced option against rivals Tesla and Volvo.
• Reinhard Fischer, the Head of Strategy at VW Group America, confirmed these plans at the Reuters Events Automotive USA 2023 conference, refuting claims that the automaker is scaling back its EV plans in the US market.
• Potential manufacturing plants for Volkswagen's affordable EV include locations in Chattanooga, Tennessee, Puebla, Mexico, and a new South Carolina assembly plant planned for VW subsidiary Scout.
• Volkswagen also plans to source battery packs locally to qualify the new EV for the Inflation Reduction Act tax credit of up to $7,500, potentially lowering the net cost for customers to around $27,500.
• The move to introduce an affordable EV comes as part of Volkswagen's strategy to expand its EV lineup in the United States, which currently includes the ID.4 electric SUV starting at $38,995, the forthcoming ID.Buzz minibus with a projected starting price around $60,000, and the upcoming flagship ID.7 with European prices starting at $62,000.

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