Volkswagen boss: ID4 total cost of ownership to be less than Tiguan in Australia

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The total cost of ownership of Volkswagen’s new ID4 and ID5 midsize electric SUVs will be lower than an equivalent combustion model, the brand’s local boss says.

Volkswagen Australia passenger vehicles brand director Michal Szaniecki recently completed a 2500km test of the ID4 from Sydney to the Great Barrier Reef, capturing the journey with a vlog on LinkedIn.

The ID4 – and its sibling model, the ID5 – will be released in Australia in the middle of 2024. They will mainly compete with the segment-leading Tesla Model Y (from $65,400 before on-road costs).

ID4 vs Tiguan: more expensive to buy, cheaper in the long run?

As well as interviewing a number of Volkswagen dealers in regional areas and describing the charging experience in rural Australia, Szaniecki discussed the issues around Australian pricing of the ID4 model.

“We shouldn’t talk about price [in isolation], but the total cost of ownership,” Szaniecki said.

“This car will be priced a bit higher than its combustion engine equivalents, like Tiguan Allspace.

“However, when you take into account the residual value, which will be high in five or six years, that charging is less expensive than putting fuel in the car, servicing will be less expensive…you find out that owning this car is not expensive – if anything, less expensive than owning a combustion engine car,” he said.

ID4 expected to straddle $78K price point in Australia

Szaniecki referred to the three-row Tiguan Allspace as the combustion equivalent of the five-seat ID4.

The two SUVs are similar in terms of interior space, with the Tiguan Allspace capped by the 162TSI R-Line model ($60,890 before on-road costs).

Volkswagen Australia public relations manager Daniel DeGasperi told Chasing Cars that both ID4 grades would primarily target the Tesla Model Y Long Range variant, which is currently priced at $78,400 before on-road costs.

When it launches locally, the ID4 will be offered in 210kW rear-wheel drive guise or 250kW GTX all-wheel drive form, both with good levels of standard specification. The two variants are expected to straddle the Tesla’s $78K list price.

ID4 costs $10K less to run over five years than a Tiguan

Ownership costs for a Tiguan Allspace 162TSI for its first five years and 75,000km of driving total $3200 for pre-paid servicing, and $13,500 for refuelling at $2.00/litre and 9.0L/100km.

Charging the ID4 for five years/75,000km at an average of $0.40/kWh and consumption of 17.0kWh/100km would total $5100 – $8400 less than petrol costs for the Tiguan.

The Volkswagen ID4’s smaller cousin, the Cupra Born, is available with a $1590 pre-paid five-year servicing pack – a $1610 discount when compared to a Tiguan Allspace 162TSI.

That takes us to about a $10,000 saving over five years of ownership when compared to an equivalent Tiguan Allspace – though the Tiguan, in current form, is $15,000-$20,000 cheaper to buy than the expected price of an ID4.

Residual values, future emissions taxes a missing link

Szaniecki indicated in the ID4 vlog that stronger future residual values for the ID4 model compared to a petrol SUV could be the missing link that drives total cost of ownership lower for the EV.

That’s before the potential of future emissions taxing regimes are taken into account – a factor that could drive the ownership cost of combustion vehicles to a higher point.

Arriving simultaneously with the ID4 will be the coupe-SUV ID5 that shares nearly all of the ID4’s components with a more sporting body style.

The ID5 is expected to attract a small price premium over the wagon-bodied ID4.