€ 20,000 electric Volkswagen arrives in 2027

The German automaker Volkswagen is putting the rumours to rest and has officially announced the arrival of an entry-level electric car to compete with the Dacia Spring and the Citroën ë-C3. The successor to – remember? -the e-Up will arrive in 2027 and will be dubbed ID.1.

In recent weeks, it became apparent that the idea of a joint venture with Renault to build a small electric city car has been abandoned. Volkswagen has now officially stated to go solo in developing its forthcoming ID.1, preparing a 2027 launch and priced around 20,000 euros. The automaker announced after a board meeting in Wolfsburg. The new addition to the ID range will be produced in Europe, which is always a tricky decision when venturing into the budget-conscious territory.

Uncertain production location

Group CEO Oliver Blume emphasised the significance of this decision, stating, “This is a clear commitment to Europe as an industrial location. It’s about entry-level electric mobility from Europe for Europe.” While the exact production site remains undecided, the focus is on making electric vehicles accessible and appealing, especially in the entry-level segment. To reach a low-cost level, the rivalling Dacia Spring is made in China, but with the Slovakia-built ë-C3 Citroën, it proved that it could be done.

The production location for the ID.1 remains uncertain, though manufacturing in Germany is unlikely due to these cost considerations. Volkswagen has already decided to produce the ID.2all at its subsidiary Seat in Spain starting in 2025, alongside similar models from Cupra and Skoda.

“Electric mobility for everyone”

This strategic move comes in response to the high prices of existing electric models like the ID.3, which starts at just under 40,000 euros. A price too steep to accelerate EV adoption under private customers. In just a few years, electric cars have conquered a 14.6% share of the European market by 2023. But they remain confined to the higher segments. The upcoming ID.1, expected to fill this gap, will be essential to Volkswagen’s plan to unfold its roadmap towards the EU ban on combustion-engined cars in Europe by 2035.

Thomas Schäfer, head of the Volkswagen brand, also highlighted the importance of affordable electric vehicles, noting, “For electric mobility to become widely accepted, we need attractive vehicles, especially in the entry-level segment. Our brand promise is: “electric mobility for everyone.” Development of the ID.1 is already well underway, he added. “We are already in the middle of it, we know what the car has to look like.” Despite the ambitious price point of 20,000 euros, Schäfer acknowledged the economic challenges, particularly with rising energy, material, and raw material costs. Achieving this price will require large-scale production to offset high battery costs.