Volkswagen Group has decided to make all-electric entry-level mobility more widespread, with affordable electric vehicles (EVs) made in Europe for sale in Europe, and will do so by relying on localisation on the continent.

VW new EV europe

VW Group’s new European EV will be affordable because of the OEM’s strong localisation of its supply chain in Europe, particularly in Spain

The group is planning a world premiere of a more affordable €20,000 ($21,700) EV in 2027 to “create mobility for all and continue to facilitate the entry into e-mobility”.

Europe is the key driver of VW Group’s electrification strategy, with its Wolfsburg plant in Germany at the centre. In its financial results for the first three months of 2024, the carmaker said its order bank for vehicles in western Europe has remained stable at a high level of 1.1m units, including 160,000 BEVs. In 2023, Europe saw an increase of 61% to 341,100 BEVs delivered.

Oliver Blume, CEO, VW Group said the electrification project is “about entry-level electric mobility from Europe to Europe. In doing so, we combine a clear commitment to Europe as an industrial location, a European industrial policy and ultimately act in the interests of European customers”.

VW Group already has sites for two battery cell factories in Sweden, with Northvolt, and its PowerCo division is building plants in Salzgitter, Germany and Valencia, Spain. The carmaker had also been looking at a fourth site in the Czech Republic, Hungary, Poland or Slovakia, but delayed a decision in November last year because of lagging EV demand. By 2030, the carmaker plans to create six gigafactories in the continent, with a total capacity of 240 gigawatt-hours (GWh).

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Thomas Schäfer, head of Brand Group Core and CEO of the VW brand said: “Despite the attractive price, our vehicles will set standards in the entry-level segment in terms of technology, design, quality and customer experience. This task has become more demanding due to rising energy, material and raw material costs. One thing is clear: electromobility from Europe for Europe can only succeed with political support and competitive framework conditions.”

The OEM is already planning to make electromobility widespread in Europe with its Electric Urban Car Family project, which will see EVs being sold for under €25,000 by the end of 2025. These plans include four models; two compact cars from VW and Cupra, and two small SUVs from Skoda and VW, all of which will be built in Spain.