Volkswagen has signaled a definitive shift away from small gasoline-powered vehicles, phasing out key compact models as it accelerates its transition to an electric future.

The Diminishing Viability of Small Combustion Cars

While the European auto industry avoided the strictest interpretation of the EU's 2035 combustion-engine ban, regulatory pressure remains intense. Despite some regulatory flexibility, automakers must achieve a 90% reduction in fleet emissions from 2021 levels, with stricter CO₂ limits arriving years before the decade's end. Regulations will tighten further after 2030.

In response, Volkswagen is taking a firm stance. Thomas Schäfer, CEO of the Volkswagen brand, explained that developing new small gasoline cars like the Polo to meet these standards is no longer economically feasible. "The future in this segment is electric," he stated. The core issue is cost: engineering compliant combustion engines would make these vehicles prohibitively expensive, stripping them of their fundamental advantage—affordability.

The Electric Successor to the Polo

Consequently, the timeline for small internal combustion engine (ICE) cars at VW is limited. While the Polo won't vanish immediately, its long-term replacement will be fully electric. Volkswagen plans an "ID. Polo" as its spiritual successor, ensuring the nameplate continues without a gasoline engine.

A revival of ultra-small city cars like the Up! or Lupo with combustion engines is also ruled out. With a wave of more affordable EVs imminent, VW sees no rationale for reinvesting in this segment with traditional powertrains.

The first of these new electric models will arrive soon. A Polo-sized electric hatchback is expected next year with a starting price around €25,000 (including VAT). By 2027, the production version of the ID. Every1 concept aims to lower the entry point to approximately €20,000. Government incentives in some EU countries could further reduce these prices.

Volkswagen's plans extend further. A Polo-sized electric crossover, previewed by the ID. Cross concept, has already been revealed. All three upcoming models will utilize the dedicated EV architecture, the MEB+ platform.

A Gradual Transition

Despite this clear strategic direction, the change will not be abrupt. Current gasoline models, including the Polo and T-Cross, will remain in production for an unspecified period, coexisting with their new electric counterparts. While the company has not announced firm discontinuation dates, the long-term path is unambiguous: the era of combustion engines in Volkswagen's smallest cars is concluding.

Context and Market Trends

This transition unfolds as Volkswagen continues to lead European sales. According to the European Automobile Manufacturers’ Association, the brand surpassed one million sales in the EU within the first ten months of 2025, exceeding 1.2 million vehicles when including the UK and other nearby markets.

Contrary to narratives of cooling demand, European EV adoption continues to rise. As of October, electric vehicles constituted 16.4% of EU new car sales, up from 13.2% a year earlier. If Volkswagen's gamble on affordable electric mobility succeeds, its new generation of EVs could accelerate this trend—transforming the disappearance of the small gasoline car from an ending into a natural evolution.