When Volkswagen announced the ID.3 back in 2019, the company proclaimed it was a “new era” for the brand. The electric hatchback, it said, was an achievement on par with the brand’s two most impactful products, the original Beetle and the Mk 1 Golf. I remember that moment, because it was the moment I knew VW was headed for a cliff.
The claim represented an attitude that was common in board rooms and absolutely deadly in the marketplace. Legacy automakers like Volkswagen, Mercedes, Toyota and others proclaimed that their EVs were game-changers not because of any clear lead in powertrain technology or software, but because these big, proud companies had finally gotten around to actually trying to build a real-long range EV.
The ID.3 was pegged as the most important VW since the original Golf. But due to software and quality issues, it certainly didn’t have the same cultural impact.
But without any compelling vision for why consumers would choose these products over gas cars or rival EVs, and with cost-cutting running rampant, these companies found themselves throwing money at buyers just to clear out inventory. Cars like the Volkswagen ID.4 and Toyota bZ4x were supposed to prove that these companies were ready for the next era; instead, they proved just how much their parent companies still had left to learn.
It had to learn the hard way, but Volkswagen did learn. It learned that consumers hated its new interiors, made barren and button-free by aggressive cost-cutting. It learned a lot about drive motor reliability after early ID.4 struggles. It learned about the importance of range and value with the ID. Buzz, and about software issues with its multiple attempts to right its troubled Cariad software arm. And even outside of its own mistakes, it has had to deal with industry-wide challenges like the rise of Chinese automakers and the onset of U.S. tariffs. (It did get a free gift in the form of Tesla CEO Elon Musk burning up all of his goodwill in Europe, though, allowing VW to become the continent’s number one EV seller.)
It has not been an easy road, and we have covered every stop along the way. You’ll find few voices other than mine that have been as openly critical of VW’s frazzled strategy. But with the ID. Cross and ID. EVERY1 concepts, I no longer see a wayward company trying to contend with a future it doesn’t understand. Instead, I see Volkswagen, bloodied and bare, but fiercer than ever.
Where It All Went Wrong
Hubris is the reason disruptors exist. There’s no reason Volkswagen, General Motors or Toyota couldn’t have developed the original Tesla Model S, except that they didn’t have to. All of them were quite comfortable selling gas cars, and as the undisputed leaders of the industry, they understandably thought that no one could build a better alternative. They had all of the engineering talent they could ever need, but were too set in their existing ways to really envision a new paradigm.
Then Tesla introduced one, with the Model S. It was the first long-range EV, the first software-defined EV and the first vehicle to prove that you could develop a compelling, practical, reliable electric car. Legacy automakers took notice, and many got more serious about EVs.
The original Tesla Model S disrupted the entire industry. But over a decade later, legacy automakers are still trying to learn how to replicate its success.
Yet the lack of vision remained: Many built EVs because they had to, or thought they should. No company better illustrated this issue than VW. After being caught cheating on emissions test in the largest emissions scandal in automotive history, the company was compelled by the U.S. government to invest both in nationwide charging infrastructure (in a project that became known as Electrify America) and in EVs. But you cannot compel someone to make good products, and the early efforts prove it.
The first generation of VW EVs borrowed heavily from Tesla’s playbook, but without the competency or cachet to pull it off. So while the ID.4 used the same screen-centric cabin design playbook as Tesla, it executed it with far worse software, leading to consumer frustration. And though it was better at screwing cars together than its upstart rival, high battery costs meant it had to cut corners in the cabin to make the financials work.
The original ID.4 had clunky, slow software and capacitive sliders for key controls. They also weren’t backlit, which meant adjusting the temperature at night was a tricky task.
The company also tried to hide its door handles, like Tesla does, yet fumbled the design so hard that the ID.4 had a stop-sale recall that lasted for the better part of the year. It also had drivetrain issues. All in a package that wasn’t interesting to look at or all that cheap. Then the ID.Buzz launched and didn’t really move the ball forward on software, interior design or value. I was starting to think that Volkswagen was too far behind, and moving too slowly, to catch up.
I don’t think that anymore.
Why I’m Excited About VW’s Future EVs
I may not have too many kind words for the ID.3 and ID.4, but my issues were with execution, not concept. Because fundamentally, I think an electric Golf should exist. Volkswagen has always excelled at final chassis tuning. The company’s small cars feel as sophisticated and polished as luxury vehicles, and they tend to be great to drive, too. And in a world where the average EV is heavy, floaty and under-damped, Volkswagen’s expertise is well-needed.
But the best tuning in the world won’t matter if you can’t entice consumers with a slick cabin, modern software and a real value proposition. On every front, VW has made real strides. The interior of the ID. Cross concept, a compact crossover, looks fantastic. And it follows through on VW’s commitment to bring back buttons. It also has some pretty looking software, though admittedly we haven’t gotten to try it out yet.
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Source: Volkswagen
If VW pulls it off, though, it could be a truly winning combo. Brands like Tesla and Rivian have delivered amazing software, and companies like General Motors and Hyundai have been good at fitting real hard buttons to their EVs. But nobody has teamed great software with great physical controls, and VW looks primed to seize that ground.
But whether the ID. Cross is a generational leap for VW software or not is irrelevant. Because while the Cross—which rides on a modified version of the ID.4’s platform—is proof that VW has learned how to better package its existing tech, the ID. EVERY1 is the real light at the end of the tunnel. VW’s new entry-level EV will use a new zonal electrical architecture developed as part of VW’s crucial partnership with Rivian. That’ll make the whole vehicle upgradeable over the air and save VW considerable money on wiring and computers, making its future EVs cheaper.
Combined with the company’s battery investments and honest acknowledgement that it is now playing catch-up in the U.S. in China, we should see considerably more aggressive pricing. Rivian software with VW quality and pricing should be a brilliant combination. We’ll just have to wait to see what U.S.-market vehicles get the tech first, as I doubt the small ID. Cross or the production version of the EVERY1 will get here.
Humility, Not Hubris
Volkswagen isn’t the only brand struggling with this transformation. It’s not even the only one in its own parent company. Audi has been adrift for some time, and Porsche has been blindsided by the collapse of its China business and lukewarm reception to the Macan EV. Yet all three brands finally appear clear-eyed and honest about the challenges ahead.
VW is no longer acting like a safe leader defending its turf. It has recognized that 80 years of building gas cars certainly helps, but it doesn’t make building EVs easy. It knows that, in the U.S. and Chinese EV markets at least, it is not the juggernaut but the disruptor trying to break into a market that brands like BYD and Tesla have already developed.
Beating either company won’t be easy. But for the first time in a long time, VW doesn’t look scared of the fight.
Contact the author: Mack.Hogan@Ev Authority.com
