Volkswagen Group is rethinking its ambitious push towards an all-electric future as its EV sales continue to struggle. In 2024, the group’s overall EV deliveries fell by 3.4%, with Volkswagen’s own electric car sales decreasing by 2.7%. Audi fared even worse, posting a 7.8% decline in EV sales. These figures signal a challenging transition to electric mobility, prompting VW and Audi to reconsider their electrification timelines and invest more in internal combustion engine (ICE) models.
According to German business newspaper Handelsblatt, both brands are preparing to extend the life cycles of their existing ICE models, potentially delaying the transition to fully electric lineups in Europe. While VW had previously set a target to go all-electric on the continent by 2033, new reports suggest this timeline may shift.
Flexibility Over Fixed Deadlines
Audi CEO Gernot Döllner has already signaled a more adaptable approach to electrification. The company had originally aimed to phase out ICE vehicles globally by 2033, but Döllner emphasized that Audi is staying “flexible” in response to market conditions. Meanwhile, VW’s head of technical development, Kai Grünitz, hinted at the possibility of keeping the current Golf Mk8 in production until the mid-2030s, even as the all-electric Golf Mk9 remains on track for a late-decade release. This could mean both models will coexist for an extended period, giving consumers a choice between traditional and electric powertrains.
Decisions Loom on ICE Investments
A crucial decision on further investments in ICE vehicles is expected by early March, according to Handelsblatt. If VW and Audi proceed with additional funding for combustion models, it could have ripple effects on sister brands Skoda and SEAT/Cupra, which share platforms and technologies within the VW Group.
However, regulatory pressure remains a key factor. The European Union still aims to mandate zero-emission vehicle sales by 2035, though exceptions for synthetic fuels and hydrogen-powered combustion engines leave some room for maneuverability. The future of ICE vehicles in Europe may ultimately depend on whether automakers can lobby for a delay in the 2035 deadline amid lagging EV demand.
Porsche, Bentley, and Lamborghini Adjust Strategies
Other VW Group brands are also tweaking their strategies in light of EV sales trends. Porsche saw a 49% decline in Taycan sales in 2024, prompting the luxury automaker to pivot back toward ICE models. Interestingly, the new second-generation Macan, which offers gas-powered variants, saw strong initial sales, crossing 18,000 units.
Bentley has postponed its first EV launch from 2025 to 2026 and has pushed its all-electric transition target from 2030 to 2035. Lamborghini, which outsold Bentley for the first time in 2024, has also delayed its inaugural EV, the Lanzador, to 2029. Meanwhile, the next-generation Urus SUV will be fully electric, but Lamborghini remains committed to gas-powered supercars, with the V-12 Revuelto and V-8 Temerario continuing well into the next decade.
Uncertainty in the European EV Market
Despite governmental support for electrification, European EV adoption appears to have plateaued. According to the European Automobile Manufacturers’ Association (ACEA), the EV market share in the EU declined by 1% in 2024, settling at 13.6%. If demand does not accelerate in the coming years, automakers will likely push for a delay in the EU’s 2035 ban on new combustion-engine cars.
With some of the world’s largest automakers based in Europe, these shifts in strategy will have global implications. Whether the EV revolution regains momentum or faces prolonged resistance, Volkswagen Group’s recalibrated approach underscores the complexities of transitioning to an all-electric future.
