Back in April, while Volkswagen was bragging about how much its new battery technology would reduce costs, it said that it was working on a compact EV that would cost less than €20,000 (US$21,693 at current exchange rates). Now, CEO Oliver Blume is a little less sure if that will be possible.
Whether or not VW makes such an affordable EV will likely depend on if it can make a profit selling it. The automaker has previously said that its new unified prismatic cell will cost around half as much as its current batteries, but it’s unclear if that will be enough to go below €20,000.
At a recent conference, Blume admitted that the margins are so fine that the company hasn’t yet committed to producing it, reports Reuters. However, he said he was convinced the company could get the technology to that point by the second half of the decade.
Read: VW Boss Says €25,000 EV Will Be Profitable, Sub-€20,000 EV Is In The Works
That would align with previous reports suggesting that a super cheap EV will arrive in 2026 or 2027. At the time, VW also said it was open to the possibility of partnering with another automaker to bring the project to life.
The brand said a vehicle would have to have a 6 percent profit margin in order to go into production, saying that it was “not a charity. We intend to make money.” That will allow it to make the upcoming ID.2, which it plans to sell for around €25,000 ($27,116 USD).
However, the cheaper vehicle appears to be right on the limit of what the automaker thinks it can achieve. Blume believes that making more affordable EVs will be important for the brand and the industry going forward, though.
“We have a responsibility to bring the right products at the right price onto the market,” Blume said. “After early adopters were reached with electric cars, we now need consumers to be convinced by the technology, who don’t have the opportunity to install a charging station at home.”
Note: The story includes an independent rendering that is unrelated to VW
