Volkswagen Targets Affordable EV Launch in the U.S. Within Four Years

Volkswagen Group is planning to introduce an electric vehicle priced below $35,000 in the U.S. market in the next three to four years, as detailed by a senior executive at a recent industry conference.

• Volkswagen is exploring production sites in Chattanooga, Tennessee, Puebla, Mexico, and a proposed new facility in South Carolina for its forthcoming sub-$35,000 electric vehicle.

• The company is considering local battery pack assembly to benefit from U.S. Inflation Reduction Act incentives.

• Nio, a Chinese automaker, is also concurrently contemplating a 2025 entry into North America, assessing infrastructure and potential partnerships.

According to a recent statement from a top executive at a Reuters conference covered by Automotive News, Volkswagen Group has set its sights on the U.S. electric vehicle (EV) market, aiming to launch an EV costing less than $35,000 within the next three to four years. Volkswagen is currently evaluating several of its manufacturing locations for this purpose, including existing plants in Chattanooga, Tennessee, and Puebla, Mexico. Additionally, a new assembly plant in South Carolina is under consideration, intended for the VW subsidiary Scout.

Volkswagen’s strategy reflects a broader commitment to electric mobility, with plans to potentially localize battery pack production to leverage additional incentives available under the U.S. Inflation Reduction Act. This would represent a continuation of their strategy to build battery cells in Canada for EVs produced for the North American market. In Chattanooga, the ID4 electric compact crossover is already in production, with a redesign planned for 2026 that may introduce a more affordable and rugged variant.

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Concurrently, Nio, a Chinese EV maker, expressed at the same conference through its CEO, Ganesh Iyer, that while they are considering entering the North American market by 2025, they are still in the process of debating and planning the necessary infrastructure and are open to forming partnerships to facilitate this expansion.