VW reduces electric car production and delays launch of an affordable model
A report from German media reveals a temporary halt in one shift at the Zwickau factory. At the same time, the managing director, Olivier Blume, confirms that an affordable electric car model will not be made available quickly.
5:02 PM EST, November 16, 2023
The decision to scale back work from three shifts to two was taken jointly by the works council and managers. This news was delivered by the German publication "Automobilwoche", citing the DPA agency. The ID.3 and Cupra Born models are currently being manufactured at this facility.
The Zwickau plant was a pioneer within the group, being the first to fully transition to electric car production, a feat which cost over a billion euros according to prior announcements. However, the demand for electric cars has not met expectations, leading to the production slowdown. Volkswagen is not alone in facing these difficulties as Mercedes' EQ family has also suffered due to overly optimistic predictions.
The major issue appears to be the cost. Olivier Blume, the brand's managing director, acknowledged that a decision to produce a car costing around 20,000 euros is still in the works. Regardless, he did confirm the company's intent to introduce such a model in the second half of the current decade. "We have a responsibility to offer high-quality products at reasonable prices," he conceded. The key to this is standardizing batteries, which should reduce costs by half.
However, it might be too late. Renault has unveiled the concept of the new Twingo, which is slated for launch in 2026. Their CEO, Luca de Meo, considers it as an answer to several challenges, particularly those related to costs, environmental sustainability, and the burgeoning competition from affordable electric cars from China.
