Volkswagen Group is preparing a massive investment into electrification with a new facility in Spain. With the new factory will come a new wave of affordable electric Volkswagens, addressing one of the major issues with EVs.

The 10 billion Euro investment will see the assembly of a battery gigafactory in Spain, which will aid the production of more electric vehicles at the Pamplona and Martorell factories.“This investment of 10 billion euros will electrify Spain and Europe’s second-largest automotive manufacturer, creating a battery Gigafactory in Sagunto, enabling the production of electric vehicles at the Martorell and Pamplona plants, and building-up a comprehensive supplier ecosystem. This is the biggest industrial investment ever made in Spain”, said Herbert Diess, CEO of the Volkswagen Group.

This new gigafactory will have an annual production capacity of 40 GWh, employ more than 3000 people by 2030 and construction begins in the first quarter of 2023. Production of batteries will start in 2026. Impressively, construction of a photovoltaic plant was also approved and this will supply the new gigafactory with green electricity.

One of the biggest issues around going green and electric cars is the price of the vehicles themselves. There is simply no such thing as a cheap or affordable new electric car. While calculations show that you’ll eventually recoup the costs by not having to buy petrol or diesel, the barrier to entry is far too high for the majority of consumers. As it stands currently, SA’s cheapest electric car is the Mini Cooper SE, which comes in at R710 000.

In comparison,none of the passenger cars in the top 10 best selling cars in the country are over R500 000, indicating we are a price-sensitive market. Granted, there are other factors at play like an unfavourable tax and duty system that punishes importers and more so for electric cars.

So, what can be done? Volkswagen SA has already given us a taste of both the e-Golf and the ID.3, but neither will go on sale to the public. There’ll be a testing fleet of the Volkswagen ID.4 during 2022, but we expect that to be priced close to R1 million if it is approved for sale. As part of the Spanish gigafactory announcement, Volkswagen Group confirmed there will be smaller electric cars that will be built in Spain from 2025.

While we don’t get SEAT or Skoda models, the little Volkswagen teaser image has us excited. A Polo-sized EV with 350 km of range costing under R500 000 is the dream! Could this model be the Volkswagen ID.1?Fingers crossed we see some affordable electric Volkswagens in SA sooner rather than later.

Want to buy an electric vehicle? See your options for sale here.

Further Reading

Volkswagen ID.4 Testing fleet confirmed for SA

Is it time for South Africa to Switch to EVs?