VW Suspends EV Production Due to Low Demand

The world’s largest carmaker has suspended the production of EVs for at least six weeks as buyers opt for petrol and diesel power. The production hiatus will cost 300 staff their jobs as consumers show their preference for more traditional powertrains.

The company announced that there was a major downturn in the demand for what they call zero-emission vehicles. This will temporarily halt production at their flagship EV production plant in Emden, Germany where all of the unfortunate staff that will lose their jobs work. Still, it is summer in Europe—relax, kick back and enjoy the weather, right?

The German car manufacturer say that the demand for their vehicles is 30% lower than their original forecasts, but various news reports are showing that demand for EVs has softened by as much as 12% globally.

In a lot of Europe, the subsidies that governments offered are gradually being reduced or scrapped. This is making the cost of buying a car more expensive. There is also the doubt about raw materials supplies creating a seller’s market in the battery-making and chip-manufacturing part of production, which is forcing costs to remain at higher-than-expected prices.

Range anxiety has still not gone away in Europe, largely due to the lack of investment in the infrastructure creating an overwhelming shortage of charging points. As consumers, we have gotten used to the availability of gas stations, but we forget that these were developed over decades as demand gradually rose. Governments mandating a switch to EVs seem to have forgotten that there is a problem with both the speed at which charging stations can be supplied coupled with a lack of available land to put them on. To put this into perspective, a recent survey in Europe showed that EVs outnumbered charging stations 85 to one, and that is a big discrepancy.

Demand for EVs is expected to continue to slow in Europe as the region reduces subsidies, this will slow or defer the introduction of some of the new plants that have been planned. But as a number of European nations push back on the EU7 emissions regulations that are due to take effect by 2026 and, of course, the total ban of ICE powered vehicle by 2035, the future of the EV may not be as certain as we are led to believe.