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Volkswagen delays launch of electric sedan in US and Canada, citing ‘market dynamics’ as EV demand wanes
After a splash Premiere in New York just a year ago, Volkswagen (VWAGY) is delaying plans to bring its ID.7 EV sedan to the US and Canada.
The German automaker said on Wednesday that the ID.7 – which has been on sale in Europe and China since the end of 2023 – now it’s late in the US and Canada, citing changing “market dynamics”.
To wit: declining EV demand and the decline of the sedan in America.
Last month, KBB reported EV sales increased just 2.6% year over year in the first quarter of 2024, compared to 15.2% in the fourth quarter of 2023 and 46.4% growth in the first quarter of last year.
In addition to slowing demand for electric vehicles, the sedan body has been losing popularity in the USA for some time now. Earlier this month, Chevy decided to cancel its Malibu sedan after 50 years and 10 million cars sold to focus on SUVs, crossovers and EVs.
A 2024 Volkswagen ID.7 electric vehicle is at the New York International Auto Show in New York on Saturday, March 30, 2024. (AP Photo/Ted Shaffrey) (ASSOCIATED PRESS)
A year ago, Volkswagen Americas president and CEO Pablo Di Si was optimistic about the ID.7’s prospects in the US.
“Our focus remains on SUVs, but obviously the sedan market represents 16% of the total market in the US… and bringing the ID.7 with its new premium leather interior, 300 [mile] plus in 2024, is the right approach for VW to take,” he said at the ID.7 debut in April 2023.
However, Volkswagen of America’s pivot to the ID.7 comes as its parent company is also tempering plans that once saw it ready for launch. 75 EVs in the next decadeincluding 25 in North America.
A Volkswagen spokesperson told Yahoo Finance on Wednesday that bringing 25 EV models to North America by 2030 is “still the plan.”
But earlier this month, Volkswagen Passenger Cars CEO Thomas Schäfer indicated that a change in the product portfolio was needed. Customers “want plug-in hybrids now, including in China and the US,” Schäfer said in an interview at a conference in London. Bloomberg reported.
The Volkswagen ID.7 EV. (Volkswagen) (Volkswagen)
Volkswagen has plug-in hybrid versions of the Passat sedan and Tiguan SUV in Europe, but currently doesn’t have any hybrids in the US.
The German automaker has also recently taken advantage of partnerships to reduce costs and time to market for its EVs, mainly focused on China. VW said this would partner with XPeng from China to produce two new Volkswagen-branded EVs equipped with XPeng EV software and engineering.
Earlier this week, Volkswagen’s premium brand Audi announced that it had signed an agreement with Chinese state-owned SAIC to develop new EVs for the continent.
Pras Subramanian is a reporter for Yahoo Finance. You can follow it Twitter and so on Instagram.
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