VW predicts resurgent EV sales growth

Volkswagen Australia says it remains optimistic about the future of electric vehicle sales in Australia, claiming the recent downturn in local EV registrations is less significant than many perceive.

While previously encouraging sales of EVs in Australia appear to have peaked, the German brand says much of the decline was experienced specifically in the medium segment, while growth continued in all other areas – a trend it says is set to continue.

Speaking at the launch of the company’s all-electric ID.4 and ID.5, Volkswagen Group Australia passenger vehicle director Piergiorgio Minto said the long-term EV sales trend would soon exceed last year’s total share.

“Going towards 2030, I cannot tell you if the market at that point would be maybe 40 per cent or 35 per cent [EV market share]; that’s a bit difficult to predict,” he said. “But for sure, it’s not going to be 12 per cent as we've seen last year.

“I believe it would be steadily growing during the next year and years, actually.”

According to the local Volkswagen boss, the sales graph will not be smooth all the way to the top and spikes in the overall trend are to be expected. Fluctuation will be driven by numerous moving parts, such as legislation and the usual early demand when a new model or technology is introduced.

“We have some components or some factors that are really pushing most of the market in this direction,” he said. “One is an external factor, like the NVES [New Vehicle Emissions Standard]. All the manufacturers and all the distributors will align and try to follow.

“After the first wave of early adopters and everything that they would move towards, many more customers will jump into this market.”

But as to what caused the apparent downturn in EV adoption locally, Volkswagen says the statistics are being used to focus on a specific area of decline and not the overall market.

“It was not a real slowdown,” said Minto. “So there was a little bit of a slowdown. It was on the medium SUV segment, but in total the EV market will not really slow down. It was more or less 1.5 to 1.8 per cent higher.

“The absolute numbers are one thing. If we have a look in percentage, there was a growth there.”

Volkswagen Group Australia corporate communications manager Daniel DeGasperi explained that trend deviations in early sales of a new technology are always prone to large spikes, before the market settles over time.

“Growth is going to be a sharp spike when you start from a low base,” he said. “Now there’s a groundswell of sales there as it moves into mass mainstream. It’s actually quite unsurprising that there’s a taper off and that growth will be a bit slower.”

Volkswagen is later than some rival brands to introduce its first electric vehicle, and the ID.4 and ID.5 that is only reaching Australia now has already been on sale in Europe for five years.

However, Volkswagen Australia deliberately delayed the pair’s launch date for two reasons. Firstly, so it could introduce a recent update of both models, which benefit from more power, performance and technology. And secondly, so it could deliver a pair of mid-sized SUVs that better fit the requirements of the Australian market.

When asked if introducing the ID.4 and ID.5 roughly five years earlier would have been a wise move, Volkswagen Australia passenger vehicle product manager, Arjun Nidigallu, said the car that was available at the time was simply not right for our unique local demand.

“Product wise, if we had the spec we have today then, yes, it would have been good,” he said. “But no one did. It wouldn’t have been the Vee-Dub way for us.”

Instead of the 310Nm version that launched in 2020, Australia now gets a 545Nm ID.4 and ID.5 with updated information and entertainment tech. We also get the keenly priced ID.4 Pro along with the sporty ID.5 GTX variants, something that VW believes is a far better look Down Under.

Regardless of the short-term electric sales figures, Nidigallu said the company was focusing on a broad product offering that caters for all Volkswagen customers, and not just those looking for an EV in the relatively early years dominated by early adopters.

“However these trends go for us, that global direction is going to stay the same,” he said. “And to have the choice for our customers, that’s going to be the same as well. So that’s what we’re focused on.”

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