In light of recent changes in electric vehicle sales, Volkswagen and Audi, two prominent German automakers, are opting to continue utilizing their gas engines. The decline in EV sales, along with shifting market conditions, is prompting these companies to reassess their electrification plans.
Refocusing on Combustion Engines: Current Realities
According to recent reports, Volkswagen has seen a 2.7% drop in electric vehicle sales in 2024, while Audi is grappling with an even steeper decline of 7.8%. Overall, demand for zero-emission models within the VW Group has decreased by 3.4%, confirming that the transition to a fully electric lineup is going to be challenging and unpredictable.
Future Plans of the Companies
According to insider sources cited by the German business newspaper Handelsblatt, Volkswagen and Audi are planning to delay their electrification goals in Europe. VW had previously aimed for a complete shift to electric vehicles by 2033, but it appears those ambitions are now in question. Similarly, Audi had envisioned a complete phase-out of internal combustion engines by that same year.
Audi and Volkswagen's Flexibility in Strategy Adjustment
Audi's CEO, Gernot Döllner, has already hinted that the brand will remain "flexible" in its decision-making. Meanwhile, VW’s head of technical development, Kai Grünitz, indicated that there’s a possibility of keeping the beloved Golf Mk8 on the market until around 2035. A completely electric Golf Mk9 is still on the horizon, but VW may continue to sell both models simultaneously.
Investment Decisions and Their Implications
A major decision regarding further investments in gas-powered vehicles is expected to be made at the beginning of March. Should Volkswagen and Audi choose to maintain their gas-fueled offerings, this could have repercussions for sister brands within the group, such as Skoda and SEAT/Cupra. However, should the European Union stick to its ambitious goal of mandating only zero-emission vehicles starting in 2035, it will be challenging for manufacturers to develop new gas-powered models.
Adaptation Among Other VW Group Brands
Adding to the mix, other brands within the VW Group are also reassessing their strategies. Porsche, for instance, has already made adjustments given the sluggish demand for EVs. Last year, Taycan sales plummeted by 49%, but on a brighter note, the new second-generation Macan sold over 18,000 units in its first year on the market. Nevertheless, Porsche is returning to gas engines, integrating them into models that were initially designed to be electric.
Changes at Bentley and Lamborghini
Bentley has postponed the launch of its first electric vehicle from 2025 to 2026. The brand had originally aimed to eliminate gas engines by 2030 but has now shifted its goal to achieve full electrification by 2035. Similarly, Lamborghini, which surpassed Bentley in sales last year, has delayed the debut of its first EV until 2029, while still continuing to market its iconic gas-powered models like the V12 Revuelto and V8 Temerario until the early 2030s.
Bugatti Rimac and Future Technologies
Bugatti Rimac, a joint venture between Rimac Group and Porsche, is also taking its time with the debut of its first electric vehicle, which won’t be hitting the streets in this decade. The previous parent company, the VW Group, had plans to replace the W16 Chiron with an electric alternative, but those plans have changed.
What Lies Ahead?
It’s important to note that the European Union is not outright banning combustion engines starting in 2035; instead, the regulations focus on achieving zero harmful emissions, which leaves room for internal combustion engines powered by synthetic fuel or hydrogen. However, it’s quite a tall order to expect these alternatives to completely replace gasoline engines by the middle of the next decade.
If the demand for EVs does not pick up in Europe in the coming years, automakers may start to push back against the EU’s timelines. In 2024, the market share for electric vehicles dipped by 1%, reaching 13.6% in the EU, according to official data from the European Automobile Manufacturers' Association (ACEA).
Ultimately, the decisions made by Volkswagen and Audi may have significant implications not just for the European market, but for global automotive trends as well, given that many of the industry's key players are based on the continent. Time will tell how these developments unfold and which models will rise to popularity in the years ahead.
Sources: Motor1, MSN
