Volkswagen announced that its upcoming entry-level electric car, expected to be priced around €20,000 ($21,580), will primarily target the European market when it is released in 2027. The company aims to reduce battery costs by then to meet the affordability goal for the vehicle. This model will be the first to feature software developed through Volkswagen’s joint venture with U.S.-based electric vehicle maker Rivian. The collaboration will reduce the need for electronic control units and minimize wiring, making the car lighter and simplifying the manufacturing process.
The company is planning to launch eight new affordable electric models by 2027, including the ID.2, a €25,000 vehicle slated for release this year. While there are only a few models priced under €20,000 in Europe, such as the Dacia Spring and Leapmotor’s T03, 11 new electric vehicles priced under €25,000 will be available this year, including the Renault R5, Fiat Grand Panda, and Hyundai Inster.
Volkswagen’s effort to create affordable EVs is a response to the growing competition from Chinese manufacturers. The company is also focusing on cost-cutting and streamlining its operations to ensure it has the resources needed to invest in more affordable models. The brand’s previous talks with Renault to jointly produce an affordable electric Twingo collapsed last year, leaving Renault to proceed with the project independently, with plans to launch the vehicle in 2026.
