Volkswagen CEO Oliver Blume announced the possibility of an electric car priced at $22,000 by around 2025, Electrek reported.
Blume made the statement during a recent conference in Berlin, underscoring the importance of making electric vehicles more affordable for the general public.
"We have a responsibility to bring the right products at the right price onto the market," Blume said.
On average, an EV from Tesla, one of Volkswagen's main competitors, cost $63,677 before tax credits, per SaveOnEnergy.com, as of October.
Volkswagen's significant price reduction would be a result of advancements in battery technology. According to Blume, developments in unified battery cells are projected to cut costs by 50%, as Reuters and Electrek reported. The new unified battery cells are suitable for up to 80% of Volkswagen's EV models, reported Tech Times.
Reduced prices have contributed to an increase in EV sales, with global sales of plug-in EVs exceeding 1 million units in July 2023, a 41% increase compared to sales last year, as InsideEVs reported.
The increasing use of EVs has already led to an improvement in air quality, as electric cars do not release direct exhaust or tailpipe pollution.
Volkswagen's $22,000 EV would be the auto company's cheapest and smallest electric vehicle to date. Known as the ID 1, it is being designed to resemble the size of Volkswagen's gas-powered Polo, according to Electrek, citing the outlet Autocar.
"The Polo is very successful and one of our icons," Thomas Shafer, CEO of Volkswagen Passenger Cars, has previously stated, per Electrek. "And we're going to use that vehicle concept in the future as well."
A few days prior to Blume's announcement, VW Group America revealed it also has plans for an electric car priced under $35,000, per Electrek, and other auto companies have made plans to launch affordable EVs as well.
Stellantis-owned Citroën announced a reduced price for its new e-C3 electric city car in an attempt to compete with Chinese EVs. The starting price for the e-C3 is around $24,500.
At the conference, Blume reiterated the importance of incentivizing consumers to transition toward the new EVs. "After early adopters were reached with electric cars, we now need consumers to be convinced by the technology, who don't have the opportunity to install a charging station at home," Blume said.
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