Volkswagen boss predicts rising prices for petrol and diesel cars

Thomas Schäfer says he wants people to ‘love’ the VW brand again after admitting shortcomings in in-car software developments

Tomas Schäfer CEO of the Volkswagen Passenger Cars Brand, Member of the Volkswagen AG Board of Management in charge of the Brand Group Volume

Volkswagen brand’s new boss Thomas Schäfer predicts greater price parity between electric and regular combustion engine cars. That’s the good news: the bad news is it will occur due to rising costs for new petrol and diesel models in the coming years.

Speaking to Car of the Year jury members, Mr Schäfer said increasingly stringent environmental requirements will force up the prices of new petrol and diesel engines, thereby bringing them closer to equivalent EV models.

New car prices have risen significantly in recent years, with many family hatchbacks costing €30,000, while new mainstream EVs are retailing at more than €40,000.

Asked what he plans to do for loyal VW customers who feel they can no longer afford a new car, Mr Schäfer said the company will be introducing a new lower priced EV, the ID.2 soon. He also suggested these buyers could either look to finance packages like personal contract plans (PCPs) to access the new cars they need, or else turn to the used market.

READ MORE

Volkswagen instigated a recent boardroom reshuffle, with the departure of VW Group CEO Herbert Diess, replaced by Oliver Blume who has been in the driving seat of Porsche. Another change was the promotion of Mr Schäfer from boss of Skoda to his new role, with responsibility for the German car giant’s eponymous brand along with its other volume players such as Skoda, Seat and Cupra.

Speaking to journalists on the jury, Mr Schäfer accepted that the VW brand has recently failed to deliver the standard of quality that many of its loyal customers had come to expect, particularly in terms of new in-car software developments. He said fixing this situation is one of his priorities in his new job, driven by his aim to make the public “love the brand again”.

Michael McAleer

Michael McAleer

Michael McAleer is Motoring Editor, Innovation Editor and an Assistant Business Editor at The Irish Times