Volkswagen is exploring the development of an all-electric successor to the Touareg, aiming to maintain its presence in the high-end SUV segment even as it shifts its primary focus toward mass-market electrification.
Filling the Luxury Gap
The decision comes as the current combustion-engine Touareg nears the end of its 24-year production run. Volkswagen is currently prioritizing high-volume, lower-cost electric models to drive its transition to an EV-centric lineup. However, sales chief Martin Sander has confirmed that the brand is not ready to abandon the “near-premium” niche entirely.
By developing an electric Touareg, Volkswagen aims to fill a specific market void: the space between mainstream family vehicles and high-end luxury brands like Audi or BMW. This strategy follows a similar logic to the discontinued Phaeton saloon, which sought to offer top-tier sophistication without the overt status signaling of a premium badge.
Understanding the “Low-Key” Affluent Buyer
A key driver behind this potential new model is a specific demographic of consumers that Sander describes as “down-to-earth yet affluent.”
Unlike buyers of luxury brands who may seek out status symbols, the Touareg target audience typically includes:
– Business owners and professionals who prioritize quality and space over brand prestige.
– Consumers seeking “stealth wealth,” preferring high-spec engineering that doesn’t draw unnecessary attention.
– Practical users who require a large, capable vehicle but find luxury brands like Porsche or Mercedes-Benz too conspicuous for certain professional environments, such as construction sites or client meetings.
The Shift to All-Electric SUVs
The proposed successor will not merely be a facelift of the current model; it is expected to be a full-electric SUV. This aligns with broader industry trends where the SUV segment continues to dominate the market. Sander noted that approximately 80% of the relevant market is now comprised of SUVs, making it the most logical platform for Volkswagen’s high-end electric ambitions.
While the Touareg does not represent the largest portion of Volkswagen’s total sales volume, it serves a vital strategic purpose: it maintains brand loyalty among high-income customers and ensures Volkswagen can compete across the entire spectrum of the automotive market.
“This market is somewhere between the volume and premium market… for customers who want a vehicle with great design and space, and a very high level of quality and sophistication but do not want to be associated with a premium brand.”
Conclusion
Volkswagen is planning an all-electric successor to the Touareg to retain high-income customers who desire luxury and sophistication without the social signaling of a premium brand. This move ensures the company maintains a footprint in the lucrative, SUV-dominated “near-premium” market during its transition to electric mobility.
