Volkswagen Has a Backup Plan in Case Its $22,000 EV Doesn’t Succeed: Selling Sausages

March 5 marked a crucial moment in Volkswagen’s history. The German company has long aspired to offer the general public an affordable electric car. This ambition was finally realized with the recent introduction of the ID.Every1, positioned at a price point of $22,000.

However, VW has a backup plan in case things don’t go as planned.

Surprising figures. Volkswagen closed 2024 unexpectedly: It sold more currywursts, Germany’s famous sausages, than vehicles. The manufacturer shipped 5.2 million cars worldwide. Meanwhile, its food division achieved a record of 8.5 million sausages sold, surpassing the previous year’s sales by 200,000 units.

The company’s culinary success is commendable. Unfortunately, it doesn’t alleviate its critical financial distress.

Sales decline. On Tuesday, the annual results revealed a concerning 30.4% drop in net profits, even as total revenues saw a slight increase of 0.7%. A significant factor contributing to this downturn is the decline in sales in China, Volkswagen’s most important market. The Chinese market recorded its lowest vehicle shipping figures in more than a decade.

Meanwhile, Chinese manufacturers like BYD have gained traction with more affordable electric models, overtaking Volkswagen as the largest car seller in China.

The secret of VW sausages. Currywursts are sausages served in curry-spiced tomato sauce and French fries. They’ve been a symbol of Volkswagen’s culture since its introduction in 1973. Originally created to feed workers in the company’s canteens, the VW currywurst has expanded and is now sold in supermarkets across 12 countries.

Notably, the VW currywurst has a part number in the spare parts catalog: 199 398 500 A, highlighting its status as a “Volkswagen Original Part.” It’s available in 30 company canteens, work site kiosks, and supermarkets near Volkswagen factories.

Butchers producing the Volkswagen sausage at the Wolfsburg plant in 1973.

Controversy. In 2021, the automaker attempted to remove currywurst from the menu at its Wolfsburg headquarters in Northwestern Germany and replace it with vegetarian options. This decision prompted an outcry from former German Chancellor Gerhard Schröder, who defended the sausage as “one of the power bars of the skilled production worker.”

In response to the backlash, Volkswagen reintroduced the VW currywurst in 2023. The company issued an apology, explaining that it had only intended to address the growing demand for vegetarian and vegan options among its employees. Since then, the popularity of currywursts has continued to rise. “The Volkswagen currywurst has long become more than just a snack–it’s an icon,” Gunnar Kilian, the group’s human resources director, said, celebrating record sales.

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Structural challenges. While Volkswagen’s sausage sales have reached historic levels, the automaker is grappling with a profound crisis. In an effort to reduce costs, the company was close to shutting down its factories in Germany for the first time in history.

Although it managed to avoid this drastic measure, it announced plans to lay off 35,000 employees over the coming years. Additionally, the company temporarily suspended its job security program, which had previously protected jobs until 2029. After a last-minute negotiation with unions in December, the program was finally extended until 2030.

External factors have also jeopardized Volkswagen’s situation. President Donald Trump recently warned of potential tariffs on car imports from Europe and Mexico, where Volkswagen has plants that supply the U.S. market. Geopolitical uncertainties and increased trade restrictions further complicate the company’s turnaround strategy.

The bet on EVs. Despite the grim outlook, Volkswagen remains optimistic about a recovery in 2025, predicting revenue growth of more than 5%. As part of its transformation plan, the company has submitted proposals to launch its most affordable electric model yet by 2027. With this, it aims to regain market share against its Chinese competitors.

Ironically, while Volkswagen is known worldwide as an automaker, it surprisingly sells more sausages than cars. This unusual pillar of stability highlights the company’s massive challenges in reclaiming its leadership in the industry and adapting to an increasingly competitive market.

Images | Erik Mclean | Volkswagen

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