Tesla and Volkswagen compete for new affordable electric cars between $ 25,000 and $ 30,000

The electric car market is about to be accessible to a lot more people as we now learn that Tesla and Volkswagen, the two leaders in the electric vehicle market, now both have electric car programs that will start to develop. approximately $ 25,000 to $ 30,000.

In surveys of the switch to electric, the price of new electric cars is still a top concern for new buyers.

When it comes to luxury segments, many EVs have caught up with the price and performance of their fossil fuel counterparts.

However, this is becoming less true in the market with a few exceptions.

Improvements in battery technology are now starting to allow automakers to achieve higher performance, especially longer ranges, at a lower price in electric vehicles, thus opening up electric vehicle ownership to more people.

Now, two major electric automakers have announced compelling electric vehicle programs that are expected to start between around $ 25,000 and $ 30,000.

In September, Tesla announced it would build a new, smaller, long-range electric car with its new battery technology starting at $ 25,000.

CEO Elon Musk commented in the announcement:

Tesla will make a compelling $ 25,000 electric vehicle that is also fully autonomous.

Musk also added that the new $ 25,000 electric car will hit the market in about three years, when Tesla ramps up production of its new battery cell.

Now Volkswagen is apparently joining the race down market for new small electric cars.

Reuters reports today that VW has given the green light to a new “small BEV” program that would start at a price of $ 24,000 to $ 30,000:

“As part of the project dubbed ‘Small BEV (Battery Electric Vehicle)’, engineers are competing to develop a purely battery-powered car the size of a Polo that will be available between 20,000 and 25,000 euros (24,000 – $ 30,000).

VW recently released the ID.3 electric car, which starts closer to the equivalent of $ 34,000 – although it isn’t sold in the United States.

It is closer to the VW Golf while the VW Polo is a bit smaller:

It’s unclear when VW plans to release the new, cheaper electric car.

Taking Electrek

I wouldn’t be surprised if they aim to bring it to market on a similar schedule to Tesla’s new, cheaper electric car.

Right now, I expect these vehicles to arrive in 2024-2025, and that’s also when I think there will be a massive shift in demand from the car market to gasoline to electric vehicles.

While there are gasoline-powered vehicles starting at a lot cheaper than $ 25,000, none of them will be competitive on cost of ownership over 5-10 years with a compelling $ 25,000 electric car, especially if you factor in the resale value.

This will result in a massive shift in demand where the vast majority of new car buyers will understand that their next vehicle has to be electric.

Of course, at this point there will already be a lot of very compelling electric options in virtually every segment of the automotive industry.

While we are still talking about 4 to 5 years, the unveiling of these two cheaper vehicles from Tesla and VW and the departure bookings will be important events which I think will give us a glimpse of this change in demand.

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