German automaker Volkswagen (VW) is speaking to potential partners to develop its EUR 20,000 electric car, and Renault is one of them, local newspaper reported, citing sources. The talks with Renault are still “at a very early stage” and could eventually come to nothing. The company has set a production target of 200,000 to 250,000 vehicles for both partners together. “We are in different discussions but nothing has been finalised,” a company spokesperson said.
Sub-EUR 20,000 EV on cards for VW
The development comes after Volkswagen CEO Oliver Blume last month said that a sub-EUR 20,000 EV is possible by the second half of this decade. Speaking at the Sueddeutsche Zeitung Wirtschaftsgipfel conference in Berlin, he emphasized on reducing battery costs to achieve this feat. The carmaker is thus looking to partner with another automaker on a platform for the car that it hopes will make battery-powered vehicles affordable for the masses.
Competition from Chinese EV makers
The average retail price of an EV in Europe in the first half of 2023 was over EUR 65,000, according to autos research firm JATO Dynamics, compared to just over EUR 31,000 in China. To beat the Chinese competitors and US carmaker Tesla, European carmakers have stepped up efforts to democratise the electric vehicle market in the face of increased competition. A spokesperson for Renault told Reuters that cooperation was necessary to be competitive with small-entry electric vehicles.
Renault Twingo EV
Renault last month announced the launch of its new EV Twingo, called Legend, which costs less than EUR 20,000, with finance chief Thierry Pieton saying the aim was to make EVs more affordable, for the masses. Volkswagen too, in March, laid out the details of an all-EV under development for EUR 25,000, to launch by 2025. Thus, a partnership between the two, if it happens at all, sounds quite befitting.