Overview
Volkswagen is evaluating whether to build the next-generation Cupra Tavascan in Europe instead of China, prompted by the European Union’s evolving trade measures on Chinese-made electric vehicles. While the current Tavascan just received a conditional exemption from extra EU tariffs, the company is weighing European production to reduce exposure to future duties and quota constraints, according to a Handelsblatt report citing internal plans and company sources.
Key details
- The current Tavascan is built in China at the Volkswagen Anhui facility in Hefei and had faced an additional 20.7% tariff on top of the EU’s standard 10% duty for imported passenger cars.
- This week, the European Commission granted a conditional exemption, allowing continued imports if Cupra adheres to a minimum price and stays within defined quotas; the baseline 10% duty still applies.
- Volkswagen has not announced a decision or timeline for the successor’s production location. A SEAT/Cupra spokesperson highlighted “synergies and global partnerships” supporting the current China-based line and declined to comment on global plant utilization strategy.
Why it matters
- Localizing future Tavascan production within the EU would eliminate exposure to EU import tariffs on China-built vehicles and reduce reliance on exemptions that may change.
- European production could align manufacturing closer to end markets but would require investment, capacity checks, and potential retooling within Volkswagen’s existing European plants.
Industry context
Europe’s 2024 trade actions on Chinese-made EVs have lifted import costs for several models, prompting automakers to reconsider manufacturing footprints, pursue exemptions, or diversify production. The Tavascan’s conditional exemption stabilizes near-term import costs but comes with pricing floors and volume caps, underscoring the trade-offs manufacturers face.
What to watch next
- An official Volkswagen announcement confirming the successor’s production site and market-entry conditions.
- Any revisions to EU tariff policies or exemption frameworks that could affect pricing and supply.
- Signals on potential European plant candidates as Volkswagen reviews capacity, labor, supplier proximity, and investment needs.
