It’s the end of the line for the Volkswagen ID.4 compact SUV in the US as the automaker has announced it is ending production of its only US-made EV at the Chattanooga plant in Tennessee this month.
The automaker said in a press release that it is prioritizing production of high-demand vehicles in Chattanooga, noting that the all-new 2027 Atlas SUV will be made at the site starting this summer.
“Volkswagen’s Chattanooga assembly plant will shift its primary focus to higher‑volume models that support sustained growth in North America. Central to this effort is the launch of the all‑new, second‑generation Atlas for model year 2027, which begins production this summer and will be available in dealerships this fall.”
2026 ID.4 Dealer Inventory Expected to Last Through 2027
VW
Of course, the current generation Atlas is already being manufactured at the plant, so it’s not exactly a surprise that the next-gen model would also be built there. After all, the Atlas has ranked as Volkswagen’s second‑best‑selling model in the United States for the past three years.
The more important part of the announcement regards the ID.4, which will no longer be assembled in Chattanooga starting this month. The automaker said this is a strategic decision and cited the unpredictability of the EV market as one of the reasons for the move, along with the need to free up production capacity for other products that are more in demand.
“As part of the focus toward higher‑volume products that meet market demand, Volkswagen will no longer assemble the ID.4 in Chattanooga starting mid-April 2026,” the automaker said. Production of the ID.4 began at the Tennessee factory in 2022.
VW noted that 2026MY ID.4 EVs will remain available to customers in the US through current inventory, which is expected to support customer demand into 2027. The company said a future version of ID.4 is currently planned for the North American market, but details will be shared at a later date. It’s not clear if the future ID.4 variant will be made in Chattanooga, though.
Decision Follows a 62% Sales Decline in Q4 2025
VW
Volkswagen ID.4 sales in the US for 2025 totaled 22,373 units, up 31.4% over 2024. However, sales saw a massive 62% decline in the fourth quarter as the cancellation of the EV federal tax credit severely reduced demand. The ID.4’s best year in the US was 2023, when a total of 37,789 units were sold, a substantial increase over 2022’s 20,511 units.
Volkswagen said it is exploring pathways to introduce “potential new product intended specifically to meet U.S. consumer needs and in line with the new focus on high-volume vehicles.”
However, the automaker was not more specific, noting that details will be announced as decisions are made. It’s probably a safe bet that the new product or products being considered for Chattanooga production are not all-electric given the US EV market downturn.
Volkswagen said it has informed Chattanooga employees and the local union of the upcoming production strategy. Hourly workers currently supporting ID.4 production will be transferred to other positions within the plant based on seniority and in consultation with the local union. In addition, the automaker will offer a special early retirement program for eligible employees.
