New Entry-level Volkswagen SUV Reaching Europe Soon!

SAUDI ARABIA : More affordable electric cars are finally on the horizon, at least for Europe. The Volkswagen Group announced on Tuesday that it has been developing compact electric vehicles with a target price of around 20,000 euros, approximately $21,700. These vehicles are set to debut in 2027.

Although these budget-friendly EVs won't hit the market immediately, their future release is significant for the long term. Currently, electric cars tend to be more expensive than traditional combustion vehicles, especially in Western markets. For the EV transition to gain traction among mainstream buyers, this price gap needs to be addressed. In contrast, China's market, where electric and plug-in hybrid vehicles make up roughly 50% of sales, offers EVs as affordable as $5,000. The correlation between lower prices and higher adoption rates in China is clear.To meet growing customer demand, companies like Volkswagen must introduce mainstream electric options over the next few years. Otherwise, they risk being outpaced by Chinese automakers, who are increasingly aggressive in their global export strategies.

Volkswagen brand CEO Thomas Schäfer emphasized the necessity of affordable electric vehicles to achieve widespread adoption. Schäfer also assured that despite their low price, these vehicles will set benchmarks in terms of technology, design, quality, and customer experience.

The Volkswagen Group, which includes brands like VW, Audi, Porsche, and Škoda, is developing a range of EVs across different price points. While the high-end segment is catered to by a new electric platform for Audi and Porsche, the lower end will see a series of EVs priced around 25,000 euros. 

This lineup includes two compact cars from VW and Cupra, as well as small SUVs from VW and Škoda, expected to debut as early as the end of 2025. The upcoming 20,000-euro models are the logical next step for Volkswagen, which currently offers the ID.3 hatchback as its entry-level electric vehicle, starting at roughly 40,000 euros.

Details about the 2027 models remain scarce. Volkswagen has only released a shadowy teaser image of a small hatchback, leaving much to the imagination. As for the U.S. market, which has been lacking in affordable and appealing electric options, the implications of Volkswagen's announcement are still uncertain. The company has described these 20,000-euro models as models that are not only for Europe, but they’ll also be from Europe. However, brands like Kia, Chevrolet, Volvo, Ford, and Tesla are all gearing up to introduce entry-level EVs in the U.S. 

With electric vehicles steadily capturing a larger share of the market, any manufacturer aiming to attract mainstream American buyers will need a competitively priced EV in their lineup. Therefore, it is likely that Volkswagen will eventually bring a compact SUV to the U.S. to complement its current offering, the ID.4.