June 25, 2021

Gp Delivers1

The excellent automotive artisans1

Audi Q4 e-tron plays key role in VW’s electrification strategy, challenges Tesla

Audi’s new Q4 e-tron will go head-to-head with Tesla Inc. in the fast-growing market of compact crossovers to help parent Volkswagen Group narrow its EV sales gap with the world leader.

The model Audi unveiled Wednesday in Europe is among a dozen models — such as VW’s ID.4 and an electric version of the Porsche Macan — that should enable VW to exceed Tesla’s deliveries by 2023, Bloomberg Intelligence analyst Michael Dean said in a recent report. VW has targeted selling roughly 600,000 purely battery-powered cars this year as Europe’s biggest carmaker seeks to gain ground on its California-based rival.

The Q4 e-tron is Volkswagen’s first real competitor to Tesla, being a modest-sized crossover, “which hits the right segment,” Dean said. He expects the model to offer more than 300 miles of battery range and sell for about 40,000 pounds ($55,000).

So far this year, Tesla has done well defending its dominance. Demand for the Model Y and Model 3 in China supported strong first-quarter deliveries and has reignited investor optimism about the world’s most-valuable automaker holding its own in an increasingly crowded EV market. Incumbent manufacturers including VW, General Motors and Mercedes-Benz have stepped up plans to churn out EVs while smaller upstarts such as Nio Inc. and XPeng Inc. also vie for tech-savvy customers.

VW has positioned Audi at the center of its challenge to Tesla by building up its EV lineup and tasking it with taking lead on developing software — an area where Tesla remains well ahead. Audi is also responsible for running an engineering task force called Artemis that’s looking to speed up vehicle development.

The Q4 e-tron models “play a central role in the brand’s electrification strategy by launching in a particularly popular market segment,” Hildegard Wortmann, Audi’s sales chief, said in a video message. They represent the entry point of Audi’s electric offerings and “showcase how our brand and our design are moving forward.”

While the e-tron GT shares underpinnings with the Porsche Taycan, the Q4 e-tron is based on VW’s architecture for mass-market electric cars.

The platform, called MEB, stacks up well against Tesla on a number of key aspects, UBS Group AG analysts said in a detailed report last month. MEB underpins the VW brand’s ID3 and ID4 models as well as Skoda’s upcoming Enyaq. A separate platform for other upscale Audi and Porsche models, dubbed PPE, will launch next year.