Volkswagen to launch $20,000 EVs on a new platform in China, its most important market
Volkswagen plans to launch a new entry-level EV platform in China to keep pace with Tesla and BYD. The automaker will introduce EVs starting at around $20,000 (140,000 yuan) to win back buyers in its most important market.
Competition in the world’s largest EV market is intensifying as price cuts from market leaders like Tesla and BYD are pressuring other automakers.
The Chinese market is very “price-sensitive,” VW China boss Ralf Brandstaetter told reporters Friday, according to Automotive News Europe.
During a visit to its new EV facility in Hefei, Brandstaetter said the new entry-level platform will cater to local Chinese buyers in regards to the battery, electric drive, and motor. Perhaps, more importantly, Chinese buyers are younger and looking for the latest tech and software.
Based on VW’s MEB architecture, used for its existing lineup of EVs, the new platform will use local suppliers to cut costs.
Brandstaetter added the new platform, slated for 2026, will improve development times by a third.
With plans to introduce ten new EVs globally by 2026, Volkswagen wants to accelerate development time to keep pace with Chinese automakers. It aims to launch new models in around 2.5 years, compared to its current four-year cycle.
The company is already having some success lowering costs already. Ludger Luehrmann, CTO of Hefei (Volkswagen Group China Tech Company), which is developing the platform, said the company can lower the price of the dashboard display by 37% after switching suppliers.
Volkswagen to introduce $20,000 EVs in China
Legacy brands (like VW and Audi) that have long dominated the market are now being swapped for domestic brands with more modern tech. And many times, these EVs come at a lower price.
VW lost its long-standing title of best-selling brand in China to BYD earlier this year as buyers look for the latest EVs.
China is VW’s most important market, accounting for nearly half its profits. Its top-selling electric model, the ID.3, ranked 22nd among Chinese EVs this year. And that’s after slashing prices by 16% to around $17,500 (125,800 yuan) in August.
The lower prices helped boost demand, with ID.3 sales reaching 10,000 in July compared to an average of around 2,200.
The automaker will use this strategy with its new archetecture, called A Main Platform. Volkswagen plans to launch four new EVs priced from around $20,000 (140,000 yuan) to $23,800 (170,000 yuan).
The new VW models will be built by its joint ventures with SAIC and FAW, Brandstaetter said. The company invested around $1.1B (1B Euros) to establish VCTC, which will be key in regaining market share.
The facility uses local suppliers and involve VW’s joint venture partners to accelerate development times. VW China’s boss explained this will cut out “time-consuming coordination across time zones with developers in Germany.”
He added this will enable VW to “shorten the time it takes to bring products to Chinese cutsomers by 30%.”
The automaker opened ID.7 Vizzion orders in China this week, starting at $33,000. The Vizzion is FAW-VW’s version of the flagship electric sedan built for China.
Volkswagen also began producing batteries at its Hefei factory. The plant will be the first to manufacture cell-to-pack (C2P) batteries, which will help improve energy density and efficiency.
Electrek’s Take
With VW’s price cuts helping to boost demand in China, the company is taking notes. VW now plans to double down and introduce four new EVs priced around $20,000 to regain buyers in its most important market.
VW will need to with low-cost EVs like BYD’s Dolphin, starting at about $16,100 (116,800 yuan) and Yuan Plus electric SUV at about $18,500 (134,000 yuan). BYD sold around 30K Dolphin models in May, about 11 times the ID.3.
BYD’s 6 millionth NEV (including hybrids) rolled off the line Friday as the automaker aggresively expands the brand.
T o regain competitiveness, VW invested $700 million into Chinese EV maker XPeng for a nearly 5% stake in July.
Although the brand expects new models built with XPeng will help sales, CFO Arno Antilitz explained VW could lose further market share until they hit the market (from 2026).
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GreenPower Motor Company says it’s received three orders for 11 of its BEAST electric Type D school buses for western state school districts in Arizona, California, and Oregon.
GreenPower hasn’t made the sort of headline-grabbing promises or big-money commitments that companies like Nikola and Lion Electric have, but while those companies are floundering GPM seems to be plugging away, taking orders where it can and actually delivering buses to schools. Late last year, the company scored 11 more orders for its flagship BEAST electric school bus.
As far as these latest orders go, the breakdown is:
- seven to Los Banos Unified School District in Los Banos, California
- two for the Hood River County School District in Hood River, Oregon
- two for the Casa Grande Elementary School District in Casa Grande, Arizona
Those two BEAST electric school buses for Arizona will join another 90-passenger BEAST that was delivered to Phoenix Elementary School District #1, which operates 15 schools in the center of Phoenix, late last year.
“As school districts continue to make the change from NOx emitting diesel school buses to a cleaner, healthier means of transporting students, school district transportation departments are pursuing the gold standard of the industry – the GreenPower all-electric, purpose-built (BEAST) school buses,” said Paul Start, GreenPower’s Vice President of Sales, School Bus Group. “(The) GreenPower school bus order pipeline and production schedule are both at record levels with sales projections for (2025) set to eclipse the 2024 calendar year.”
GreenPower moved into an 80,000-square-foot production facility in South Charleston, West Virigina in August 2022, and delivered its first buses to that state the following year.
Electrek’s Take
Since the first horseless carriage companies started operating 100 years ago (give or take), at least 1,900 different companies have been formed in the US, producing over 3,000 brands of American automobiles. By the mid 1980s, that had distilled down to “the big 3.”
All of which is to say: don’t let the recent round of bankruptcies fool you – startups in the car and truck industry is business as usual, but some of these companies will stick around. If you’re wondering which ones, look to the ones that are making units, not promises.
SOURCE | IMAGES: GreenPower Motors.
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While some recent high-profile bankruptcies have cast doubt on the EV startup space recently, medium-duty electric truck maker Harbinger got a shot of credibility this week with a massive $100 million Series B funding round co-led by Capricorn’s Technology Impact Fund.
It’s been a rough couple of weeks for fledgling EV brands like Lion Electric and Canoo, but box van builder Harbinger is bucking the trend, fueling its latest funding round with an order book of 4,690 vehicles that’s valued at nearly $500 million. Some of the company’s more notable customers including Bimbo Bakeries (which owns brands like Sara Lee, Thomas’, and Entenmann’s) and THOR Industries (Airstream, Jayco, Thor), which is also one of the investors in the Series B.
Other prominent investors include Tiger Global, the Coca-Cola System Sustainability Fund, and ArcTern Ventures.
As for what makes Harbinger such an attractive investment prospect, Dipender Saluja, Managing Partner of Capricorn Investment Group’s Technology Impact Fund explains that, “Harbinger has demonstrated a remarkable ability to reach significant milestones far quicker than other EV companies … the market has been impressed by their ability to develop large portions of the vehicle in-house to drive down unit costs, while remaining capital efficient.”
The company plans to use the funds to ramp up to higher-volume production capacity and deliver on existing orders, as well as build-out of the company’s sales, customer support, and service operations.
“Harbinger is entering a rapid growth phase where we are focused on scaling production of our customer-ready platform,” said John Harris, co-founder and CEO. “These funds catalyze significant revenue generation. We’ve developed a vehicle for a segment that is ripe for electrification, and there is a strong product/market fit that will help fuel our upward trajectory through 2025 and beyond.”
The company has raised $200 million since its inception in 2021.
SOURCE | IMAGES: Harbinger.
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There is no state more associated with cars and car culture than Michigan – and the state that’s home to the Motor City has just taken a huge step into the future with the deployment of its first-ever all electric police vehicle.
The 2024 Ford Mustang Mach-E patrol vehicle is assigned to the Michigan State Police State Security Operations Section, and will be to be used by armed, uniformed members of the MSP specializing in general law enforcement and security services at state-owned facilities in the Lansing, MI area.
“This is an exciting opportunity for us to research, in real time, how a battery electric vehicle performs on patrol,” says Col. James F. Grady II, director of the MSP. “Our state properties security officers patrol a substantially smaller number of miles per day than our troopers and motor carrier officers, within city limits and at lower speeds, coupled with the availability of charging infrastructure in downtown Lansing, making this the ideal environment to test the capabilities of a police-package battery electric vehicle.”
The MSP’s Precision Driving Unit is nationally renowned for its annual Police Vehicle Evaluation, which our own Scooter Doll participated in last year, driving the then-new Chevy Blazer EV Police Pursuit Vehicles in a game of “cops and robbers.”
In those tests, the EVs have impressed – but the MSP has been hesitant to commit to a BEV until now. “We began testing battery electric vehicles in 2022, but up until now hybrids were the only alternative fuel vehicle in our fleet,” said Lt. Nicholas Darlington, commander of the Precision Driving Unit. “Adding this battery electric vehicle to our patrol fleet will allow us to study the vehicle’s performance long-term to determine if there is a potential for cost savings and broader applicability within our fleet.”
Michigan joins other states like Wisconsin and California in deploying electric patrol cars and saving big money on fuel and maintenance, with many more out there and many more to come.
SOURCE | IMAGES: Michigan State Police.
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