VOW Volkswagen AG

By William Boston 

WOLFSBURG, Germany -- Volkswagen AG lifted the curtain on the first of a new generation of vehicles it is betting will take the electric car out of its tiny market niche and make it the new car for the masses.

At a presentation at the company's design center on Thursday, VW executives took the wraps off the ID.3 hatchback, the first vehicle to be built on its new standardized electric car technology. The car goes into production in Germany in the coming weeks and will be officially launched in Europe at the Frankfurt Motor Show next month.

The self-parking ID.3 shows how big-volume car makers are unleashing a new generation of technologically advanced vehicles that will allow them to wrestle back leadership of their industry from upstarts like Tesla Inc.

The launch is a milestone for VW, which has invested heavily in the transition from combustion engines to electric vehicles despite the slowdown in global car sales that has hit manufacturers badly.

Today, the electric car is a niche product and largely dominated by upscale and expensive brands such as Tesla, Jaguar and Audi. But in order for the industry's huge bet on electrification to pay off, car makers will have to sell millions of the vehicles to mass-market consumers, not just an elite group of wealthy, environmentally conscious consumers.

The ID.3 is meant to symbolize VW's ambition to produce an electric vehicle that becomes as ubiquitous on the world's highways as the original Volkswagen, the Beetle, was in the years after World War II before being overtaken by the compact Golf, the company's all-time best-seller.

VW is positioning the ID.3, and eventually a fleet of 20 models built on the same technology, to fill those shoes. Ultimately, it expects to build one million electric cars with this technology by 2025 and a total of 15 million before upgrading the vehicle's core technology.

The new model is also meant as Volkswagen's exhibit A in its argument that it has left its dirty diesel past behind it, having learned its lessons from the 2015 diesel emissions cheating scandal that tarnished its image and cost the company around $30 billion in fines, penalties and consumer compensation.

VW has even gone as far as changing its iconic blue and white badge. Instead of the 3-D logo VW has flattened it, making it sharper and better to view on digital devices.

Bumper to bumper, the ID.3 is about as big as the Golf. But without an internal combustion engine hogging space up front, the interior is spacious, offering as much space inside the car as the Golf's upscale cousin the Passat.

The car, which is packed with advanced driver assistance technology and connected to the internet, is already on sale in preorders in Europe, starting at around EUR30,000 ($33,000).

The ID.3 won't be sold in the U.S. Instead, Volkswagen plans to begin production of the ID "Crozz", an electric SUV using the same technology, at its plant in Chattanooga, Tenn.

The idea for the ID.3 was born in October 2015 in the weeks after U.S. authorities disclosed that Volkswagen had rigged millions of cars to cheat diesel emissions testing and carried out a decadelong coverup to hide the scam from environmental regulators.

Company executives showed an advertising spot for the ID.3, flashing a succession of images of the car and its follow-on models -- including the ID Crozz SUV and a retro knockoff of VW's famous hippy van -- and even an image of Swedish climate change activist Greta Thunberg.

"We are on the road to creating emissions-free mobility for everyone," said Jürgen Stackmann, the company's sales chief.

Write to William Boston at william.boston@wsj.com

(END) Dow Jones Newswires

August 22, 2019 11:02 ET (15:02 GMT)

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