Volkswagen’s Bold Move: New Electric Models, Factory Restructuring & Rivian Partnership

Volkswagen unveils plans for nine new EVs, including the affordable ID.1. The company shifts Golf production to Mexico, restructures German plants, and partners with Rivian. Read more.

Volkswagen is making bold moves to reclaim its competitiveness in the rapidly evolving electric vehicle market. Facing fierce competition from Chinese automakers and Tesla's market dominance, the German giant has launched an ambitious strategy known as Triple A (Accelerate, Attack, Achieve), designed to speed up development, aggressively expand its market presence, and establish technological leadership.

A key part of this plan is the introduction of nine new electric models by 2027. Among them are the ID.2 and ID.1, compact and affordable additions to Volkswagen’s popular ID lineup. The ID.1 is expected to start at approximately €20,000 (~$20,900), making it one of the most accessible European EVs. The new model will be officially unveiled in March 2025, with Volkswagen employees in Wolfsburg getting the first look.

However, such a large-scale transformation does not come without tough decisions. To optimize production, Volkswagen is relocating Golf production from Wolfsburg to Mexico, freeing up space for the company’s electric future. Meanwhile, the iconic Golf will return as a fully electric model in 2029, developed in collaboration with Rivian. This partnership aims to combine Volkswagen's mass production expertise with Rivian's advanced software-driven vehicle technologies.

In addition to model shifts, Volkswagen is undergoing a major restructuring of its German factories. By 2030, the company plans to close three plants and cut around 35,000 jobs, aiming to reduce excess production capacity by 734,000 units and save up to €15 billion. Even the Wolfsburg plant will see significant changes, with two of its four assembly lines set to shut down, leading to further workforce reductions.

Despite these challenges, Volkswagen remains a dominant force in the EV market. The ID lineup has already sold over 1.35 million units, with ID.3 sales reaching 149,000 and ID.4/ID.5 selling 182,000 in 2024 alone. However, the ID.Buzz has struggled to meet expectations, mainly due to its high price.

Can Volkswagen catch up with its competitors? The question remains open. On one hand, the company is betting on affordable EVs to attract a wider audience. On the other, by the time these models hit the market, the industry will have evolved further, and competition will be even tougher. For now, Volkswagen is pushing forward, reshaping its production landscape and laying the groundwork for its future in the electric era.

Source: volkswagen-group.com