According to Bloomberg, citing unnamed sources close to the matter, Volkswagen is now planning yet another, even cheaper electric vehicle. This EV would be a subcompact, entry-level crossover, with a starting price of about $21,000. According to the report, VW expects to sell 200,000 units of this entry I.D. EV.
With more models coming soon after, and plans to continue to expand its EV sales, Volkswagen is looking to dedicate current production facilities to build electric cars on its modular MEB platform. VW's plant in Emden, Germany, plant could be converted from producing Passats to build a mid-sized sedan and wagon called the I.D. Aero, for instance. VW will also build EVs in China, as well as at its sole U.S. factory in Chattanooga, Tenn.
It's possible that Volkswagen could also license its MEB architecture to Ford. The two companies have been in talks to explore potential for cooperation, igniting rumors about the companies joining forces. The two automakers are strong in separate markets, and their differing portfolios could help each other cut costs and be successful, especially if Ford supplies trucks to VW, while the German company provides EV technology to the American brand. It's possible, too, that the VW I.D. Buzz could be built at a Ford factory in Turkey.
While the Bloomberg report cites VW's planned entry-level EV crossover as a challenge to Tesla, a $21,000 subcompact crossover wouldn't compete directly with anything in the Tesla lineup. Instead, the new VW would offer a cheaper entry option that could help compete in terms of overall EV sales, rather than pose a segment-specific competitor to Tesla's more expensive offerings. The Hyundai Kona EV is a more realistic in-segment competitor.