The ID.4 is the most affordable EV to lease in the US, starting at just $129 per month. Even with some of the biggest discounts on the market, Volkswagen is struggling to sell its electric SUV. Now, it’s planning to pause production in the US.
Volkswagen ID.4 discounts are still not enough
Starting in late October, Volkswagen will pause ID.4 production in Chattanooga, Tennessee. The German automaker informed workers at the plant of the plans on Tuesday.
The production halt will result in about 160 employees being put on furlough. Volkswagen spokesperson Michael Lowder said in an email (via The Chattanooga Times Free Press) that the furloughed workers will receive 80% of their base compensation and will still retain their benefits.
According to Lowder, the move is “a market-driven decision.” Volkswagen is adjusting production based on market demand after ID.4 sales slumped 65% in the second quarter.
Volkswagen sold fewer than 2,000 ID.4s between April and June compared to nearly 5,700 in the second quarter of 2024.
Although the ID.4 was the third best-selling EV in the US in January, it lost eligibility for the $7,500 federal EV tax credit shortly after and has struggled since.
Volkswagen has been offering huge discounts to compensate, dropping ID.4 leases to as low as $129 per month, making it the most affordable EV to lease in the US.
It apparently hasn’t been enough. Volkswagen already cut ID.4 production earlier this year. The company didn’t say how long it expects the halt to last or when furloughed employees will return.
Volkswagen blamed “a challenging environment” after US sales fell 29% in Q2. The company sold 1,992 ID.4s and 564 ID.Buzz models during the quarter. The only Volkswagen model that had higher sales compared to the same period last year was the Golf R.
With the $7,500 tax credit set to expire at the end of September, will it level the playing field for Volkswagen? Or will it continue falling behind competitors like the Hyundai IONIQ 5 and Chevy Equinox EV? It will be interesting to see where the rankings stand at the end of the year. Let us know your thoughts in the comments below.
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