VW Plans to Produce $21K ID.1 in Portugal, Might Incorporate Chinese Components to Cut Costs | Carscoops

      The brand's new baby electric hatchback will be smaller than the Polo and is expected to cost around €20,000.

      6 hours ago

      by Brad Anderson

      VW acknowledges that generating positive margins with the ID.1 will be challenging.

      The ID.1 will be the first model from the brand to utilize Rivian’s electric platform.

      The new model will be built on VW’s MEB front-wheel drive architecture.

      It has only been a week since VW showcased its new entry-level EV, the ID. Every 1 concept, and the brand has already announced where the production version will be manufactured. It will not be produced in Germany, but at VW’s Autoeuropa factory in Setubal, Portugal.

      The production model of the ID. Every 1, likely to be named the ID.1, will be significant for VW. It will serve as the company’s entry-level EV, starting at approximately €20,000 (~$21,000), which positions it to compete with the BYD Seagull set to enter the European market. To produce and sell a small EV at such a low price, it is understandable that VW aims to capitalize on the affordable labor and energy costs in Portugal.

      According to VW CEO Thomas Schaefer, this factory is one of the most cost-effective in Europe, and he believes the ID.1 will play a crucial role in attracting new customers to the brand, as reported by Auto News. During the same discussion, Schaefer mentioned that VW might consider sourcing certain ID.1 components from Chinese suppliers to lower costs compared to locally sourced parts.

      The ID.1 will be positioned between the Polo and the smaller Up!, but it should provide interior space comparable to the slightly larger Polo. Like the concept, the production version will utilize VW’s new MEB front-wheel drive platform and feature a single electric motor generating 94 hp. The company has not disclosed the size of the battery pack for the EV.

      VW's entry-level EV will also be the first model utilizing the electric architecture currently in development with Rivian. The two companies formed a partnership last year, and the German automaker is investing $5.8 billion into the American EV producer. The first models from VW Group equipped with the new architecture are expected to debut from Porsche and Audi in 2027.

      As per VW Group CFO Arno Antlitz, achieving positive margins with the ID.1 will be “difficult,” but he believes it will alleviate some pressure on VW's more profitable EV models, such as the ID.2.