How will VW price its next-generation electric vehicles? Think TDIHow will VW price its next-generation electric vehicles? Think TDI

Volkswagen says that it aims to make “electric vehicles for millions, not millionaires” with its next-generation EVs.
While that’s a clever tagline, what ultimately will matter to many households who want a new electric vehicle in the driveway is whether they can afford one of those models.
Speaking at an event last month previewing some fundamentals of the upcoming modular electric platform (MEB) that it hopes will underpin a million EVs a year by 2025, Thomas Ulbrich, the member of the VW Group Board of Management responsible for e-mobility, gave some important guidance about the automakers intended pricing: These vehicles will be priced at the level of a comparable diesel car.
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“And then we are sure we can convince millions, because then it is no longer a price range for special customers,” said Ulbrich.
VW Electric for All
To look at how Volkswagen priced TDI models just prior to the diesel scandal, a 2015 Volkswagen Jetta 1.8T SE started at $19,815, while a 2015 Jetta TDI SE started at $24,895—a 25-percent increase. Going upscale to the SUV side of the market, to the Touareg, the gasoline model started at $45,615 while the TDI started at $53,155—about 17 percent higher.
Those models will start arriving in the U.S. in 2020, as previewed by the ID hatchback and ID Crozz crossover, and then in 2022 with the much-anticipated electric take on the Microbus.
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That gap between EVs and equivalent gasoline models will likely close over time, too. Bloomberg New Energy Finance, last year, anticipated that electric cars will reach price parity with gasoline models by 2025, due to falling battery costs. That’s based on U.S. medium-segment vehicle price estimates, and an assumption that prices on internal-combustion vehicles will slightly rise.
What remains to be clarified is whether such a pricing scheme would initially include the $7,500 federal EV tax credit. Volkswagen isn’t yet close to reaching its 200,000-unit ceiling for the credit. If Volkswagen prices that first MEB model, rumored to be called the Neo, like a TDI before the tax credit, it could prove very popular indeed.

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