Transformation disadvantageous? Volkswagen’s Transparent Factory in Dresden to halt production of ID3 to reduce costs

Volkswagen's Transparent Factory in Dresden will halt production of ID3 to reduce costs

【Phoneauto News】According to sources cited by “Auto Zeitung”, Volkswagen plans to stop production of the ID.3 electric car at its transparent factory in Dresden, Germany. This is one of the measures taken by CEO Oliver Blume to reduce costs. Although the specific time for production cessation was not disclosed by the media, this decision has already been confirmed.

Volkswagen ID.3

The transparent factory opened in 2002 and initially produced high-end Volkswagen Phaeton sedans. In 2017, the factory began production of electric cars, starting with the Volkswagen e-Golf. At the end of 2020, production of the e-Golf was discontinued and replaced by the ID.3 in 2021. In 2022, the factory produced a total of 6,500 units of the ID.3 electric car.

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The characteristic of the transparent factory is its glass walls, which allow customers to observe the final stages of vehicle assembly. It is considered an architectural masterpiece and is used for various events, ceremonies, concerts, and operas. Compared to Volkswagen’s other electric vehicle factories in Germany, the factory is relatively small as it does not have body manufacturing, painting, or stamping workshops. According to sources, the factory will continue to operate, and its 300 full-time employees will be assigned other tasks, including innovative production and testing. Volkswagen spokesperson declined to comment on these rumors.

Volkswagen Transparent Factory

It should be noted that the ID.3 will continue to be produced at Volkswagen’s Zwickau factory, which is the main production base for the ID series electric cars in Germany. Starting from this autumn, the ID.3 will also be produced at the Wolfsburg factory, although the initial production volume will not be large. The decision to stop production in Dresden may also be related to the start of production in Wolfsburg.

Volkswagen Group CEO Oliver Blume is seeking to improve the return on investment for the Volkswagen brand, aiming for a profit increase of $10.7 billion by 2026. According to a source briefed on the matter, the annual operating costs of the transparent factory are estimated to be between €60 million and €70 million. Ending production at the factory would save approximately €20 million.

In recent years, European consumers have been affected by rising living costs due to inflation and increasing interest rates, which has to some extent impacted the sales of electric vehicles. Additionally, Volkswagen is facing increasingly fierce competition from rivals such as Stellantis, Tesla, and Chinese automakers.

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