Why Volkswagen is Keeping the ID 1 Project In-House
During the Volkswagen Group’s annual results call this week, one analyst suggested that Volkswagen should consider partnering with a Chinese firm to locally build the ID 1 small EV. Specifically, the idea of partnering with MG parent company SAIC, a long-time partner of Volkswagen in China, was proposed as a potential collaboration for European production.
However, CEO Oliver Blume made it clear that Volkswagen has no intentions of outsourcing the production of the ID 1. The car is set to be manufactured at Volkswagen’s Portuguese plant, utilizing a Volkswagen EV platform. While certain components may be sourced from Chinese suppliers, the core of the project remains a Volkswagen initiative.
It seems that the decision to keep the ID 1 project in-house is driven by the razor-thin profit margins associated with the production of electric vehicles. This tight financial situation has led Volkswagen to exclude the possibility of creating Skoda, Seat, or Cupra variants of the ID 1.
By maintaining full control over the production of the ID 1, Volkswagen aims to streamline the manufacturing process and maximize profitability. While partnerships with Chinese firms may offer certain advantages, Volkswagen is confident in its ability to successfully bring the ID 1 to market without external assistance.
