- The second quarter was particularly bad for the ID.4 in the US as sales fell 65 percent.
- VW is cutting production and furloughing 160 workers at its plant starting late October.
- Employees will receive 80 percent of their base compensation and retain full benefits.
The ID.4 was supposed to be VW’s answer to the Tesla Model Y, the world’s best-selling electric vehicle. However, Volkswagen of America has revealed it will reduce production of the all-electric SUV at its Chattanooga plant, indicating that it is simply not selling locally in the numbers the German brand had hoped.
Read: You Can Lease A VW ID.4 From Just $56 A Month
A total of 160 employees will be furloughed at the plant starting in late October. If there’s a glimmer of good news for employees impacted, it’s that VW will supplement unemployment from the state of Tennessee, so workers will be paid 80 percent of their base compensation and continue to receive full benefits.
Production Scaled Down
Speaking with Auto News, a VW spokesperson said that moving forward, fewer ID.4s will be assembled during each production shift.
“This adjustment in no way changes our commitment to the ID4, our growing EV portfolio, or our commitment to our Chattanooga team,” they said. “This is a market-driven decision, based on aligning our production volume to market demand.”
While production of the ID.4 will be reduced, the Atlas and Atlas Cross Sport will still be built at their current in Chattanooga.
Sales Numbers Tell the Story
A quick look at the sales numbers reveals why the production changes are being made. Through the second quarter of this year, US sales of the ID.4 dropped 65 percent. For the first six months of 2025, they are down 19 percent. Clearly, it doesn’t make sense for VW to continue building as many units as it used to if there’s insufficient demand.
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It must be noted that it’s not just 2025 that has proven to be a tough one for the electric SUV. The previous year, VW only managed to shift about 17,000 units in the US, a significant fall from the roughly 38,000 that were sold in 2023.
