Volkswagen does not want to participate in the price war launched by Tesla
While many manufacturers have decided to join the Tesla game by lowering the price of their electric cars, this is not the case with Volkswagen. The German company is not the only one.
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Price parity between thermal and electric cars is still far from being achieved, especially due to the cost of raw materials needed for batteries. And while the price of lithium is rising, the trend is therefore rather upward, especially as demand is increasingly strong. In France alone, sales of electric vehicles actually exceeded diesel sales in December.
A sudden collapse
Pending the rise of solid-state batteries, which could lower prices, electric cars are therefore relatively expensive. However, there seems to be room for maneuver, as Tesla proved. The American company really created a real tsunami by drastically reducing the prices of its Model 3 and Model Y, up to 13,000 dollars overnight. A decline that follows the worrying situation in China as well as in the United States.
And it had the effect of a bombshell, causing some manufacturers to review their strategy. We think Xpeng in particular, which has dropped the price of its P5, P7 and G3. A few days later, it was the turn of Vietnamese brand VinFast to announce the implementation of promotional operations, without giving further details.
Finally, recently, the American company Lucid dropped the price of its Air sedan, only for customers of its rental offer. That’s enough hope to stay in the race against Tesla, which broke its sales record in 2022 with more than a million vehicles delivered. Finally, yesterday, Ford announced that it is dropping the prices of its Mustang Mach-E in the United States. A surprising decision, when the brand did not plan to reduce its prices at all, but rather to increase its profits.
But not all manufacturers are ready to engage in this sudden price war. And especially not Volkswagen. In an interview with the German newspaper Frankfurter Allgemeine Sonntagszeitungthe brand’s CEO Olivier Blume confirmed thatno cuts on the agenda at the moment.
Not everyone is involved
The leader insisted “have a clear pricing strategy and focus on reliability. We are confident in the strength of our products and our brands“. A subtle pike sent to the Elon Musk brand? Anyway, no model from Volkswagen, whose electric range currently consists of ID.3, ID.4, ID.5 and ID. Buzz will not benefit from any price drop.
But the Wolfsburg company is not the only one that refuses to engage in this field. As explained Automotive Newsthis is also the case for Porsche, which is even planningraise prices by 6% according to a spokesperson. The automaker also plans to launch a premium electric SUV, which sits above the Cayenne in terms of pricing. This past July, the brand said it would be easier to increase its profitability thanks to electric vehicles.
Renault also opposes this strategy of reducing prices, although its CEO, Luca de Meo, however, advocates reducing the size of batteries to offer cheaper cars in the future. But for now, there is no reason to drop the value of cars that have been marketed. The new general manager of the diamond brand, Fabrice Cambolive, said that “if you reduce sales prices by 10% or more in a week, it will hurt residual values and hurt existing customers“.
A phenomenon that certainly affects Tesla owners, as the price of used models has fallen significantly in recent times. However, Renault is not closed to the re-evaluation of prices, while its leader confirms that “it is anticipated that the prices of electric vehicles will come under intense scrutiny“.
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