Volkswagen is gearing up to launch its first electric SUV in Australia, the 2025 Volkswagen ID.4, and there’s growing anticipation around its pricing. Contrary to earlier predictions of a steep price tag exceeding $75,000, recent developments suggest the ID.4 might be more competitively priced to rival the market-dominating Tesla Model Y.
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Aiming for Affordability: Volkswagen’s Pricing Strategy
Volkswagen Australia is in the final stages of discussions with its German head office to determine the ID.4’s pricing. The company aims to mirror the positive reception of its ID. Buzz, which undercut expectations by slotting below the Luxury Car Tax (LCT) threshold.
Karsten Seifert, Managing Director of Volkswagen Group Australia, highlighted the importance of finding a price point that appeals to the Australian market:
“We took the right time to price the ID. Buzz under the [LCT] threshold … everybody was really somehow excited about the price. A pleasant surprise.”
Volkswagen hopes to replicate this success with the ID.4, aiming to make it both desirable and accessible.
Comparing Against the Tesla Model Y
Initially expected to start around $76,000 to $77,000, the ID.4 was positioned as a slightly cheaper alternative to the Tesla Model Y Long Range AWD. However, Tesla’s recent price cuts have set a new benchmark:
- Tesla Model Y RWD: $55,900
- Tesla Model Y Long Range AWD: $69,900
Use our Drive-Away Price Checker for real-time estimates based on location.
To remain competitive, industry speculation suggests the ID.4 could start in the low $60,000 range. If achieved, this pricing would make the ID.4 the most affordable, non-China-built, electric SUV of its size in the Australian market.
Key Features of the 2025 Volkswagen ID.4
The ID.4 will debut in Australia with a long-range rear-wheel-drive variant, focusing on practicality and performance. While specific Australian specs are yet to be confirmed, global versions of the ID.4 typically offer:
- Battery Range: Approx. 500km (WLTP-rated)
- Charging: 125kW DC fast charging capability
- Power: Around 150kW output
- Interior: Spacious cabin with premium materials and advanced tech like a 12-inch infotainment screen and digital cockpit.
These features position the ID.4 as a strong contender in the family-friendly EV segment.
Why Competitive Pricing Matters
Volkswagen’s pricing decision is critical as Australia prepares to introduce CO2 emissions targets under the New Vehicle Efficiency Standard (NVES) in 2025. These regulations will require automakers to balance their portfolios with low-emissions vehicles to avoid penalties.
A competitively priced ID.4 could significantly boost Volkswagen’s EV sales, helping it meet compliance targets while appealing to environmentally conscious buyers.
The Bigger Picture: Shaping Australia’s EV Market
With first deliveries of the ID.4 expected in December 2025, Volkswagen is set to shake up Australia’s EV landscape. The ID.4’s arrival follows years of delays, but its pricing could define its success. By aligning closer to Tesla’s pricing while leveraging its German engineering pedigree, Volkswagen aims to carve a niche in the increasingly crowded EV market.
Seifert remains optimistic about the ID.4’s potential, emphasizing the synergy between local and global teams in finalizing the right price:
“It’s a good cooperation to really meet the right pricing.”
Stay Tuned for Official Pricing
Volkswagen Australia is expected to announce the official pricing for the 2025 ID.4 in the coming weeks. If the ID.4 can offer a compelling blend of range, performance, and affordability, it could become a key player in Australia’s growing EV market.
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