Monday, March 27, 2023
News The Volkswagen Group is Looking at Adding a U.S Factory for Audi...

The Volkswagen Group is Looking at Adding a U.S Factory for Audi and Scout EVs

Audi could soon build some of its electric vehicles in the United States.

  • This move is prompted by the inflation reduction act which requires EVs to be built in North America to qualify for tax credits.

  • This factory should be reserved for Audi and possibly Scout electric vehicles.

  • The brand wants to introduce only electric models starting in 2026.

The Volkswagen Group is reportedly looking at the possibility of producing Audi electric vehicles in a dedicated factory in the United States.

This decision was prompted by the inflation reduction act (IRA) which was passed by the US government last August in a bid to protect American jobs in the automotive sector and reduce the reliance on Chinese raw materials for batteries.

In addition to limiting the consumer tax credits to EVs that are assembled in North America, this act also provides incentives to automakers who choose to move their production to the U.S., which can help make manufacturing EVs significantly cheaper than in Europe.

This is precisely why Audi wants to localize its production for models sold in North America, in addition to the reduction in shipping costs.

As of now, every Audi model sold in the United States and Canada is assembled in Europe with the exception of the Q5, which is made in Mexico.

Details of the plan have yet to be finalized and it is still possible that Audi will choose to open its new factory on its own, outside of the control of the VW Group.

If the factory is opened with the rest of the company, it is likely that upcoming Scout electric vehicles will be built there as well.

Another detail that hasn’t been confirmed is whether this factory will be a new build or an existing plant that will receive substantial updates.

The latter possibility seems to be favoured by Audi, whose production chief recently said that the company prefers to modernize its current production network rather than to build entirely new factories unless there is a need for more capacity.

A new plant could be necessary since the brand wants to introduce electric vehicles only starting in 2026, however, and even more so if Scout-badged EVs are to be built on the same production line.

Announcements on this subject are expected next month when the VW Group will unveil its plans to scale up EV production worldwide.

Source: Automotive News

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