Audi is about to open the order book for its smallest electric car. The A2 e-tron is a compact hatchback built on Volkswagen Group's MEB architecture, the same family of hardware beneath the ID.3. Audi calls it the new entry point to the brand.
There is no official price yet. Early reports put it near the bottom of Audi's range, which is where the company needs it. The A1 and Q2 are leaving, and the car taking their place runs on a battery.
At the other end sits the Nuvolari, a roughly $700,000 supercar limited to 499 copies. Its 4.0-liter V8 revs to 10,000 rpm. Three electric motors help bring total output to 1,001 metric horsepower, or 987 of the American kind.
Yes, the Nuvolari is a hybrid. It also has a 7.3-kWh battery, which is less battery than some golf carts carry. Nobody will confuse the reason for buying one.
Image courtesy of AUDI AG
Audi CEO Gernot Döllner explained the split to Bloomberg on August 27.
We find that the higher the segment is, the more the enthusiast still loves the combustion engine. The lower the segment is, the more battery electric is accepted.
There it is. Audi's least expensive future model gets a charging port. Its most expensive one gets eight cylinders and a plaque telling you which of the 499 is yours.
The market already made the decision
Automakers spent the first half of this decade talking about the end of the internal combustion engine. Some of the dates were close enough to survive a CEO's tenure. Audi planned to stop introducing new combustion models in 2026 and phase the engines out in the early 2030s.
Then customers arrived.
Battery-electric vehicles reached 10.5 percent of the American new-car market in the third quarter of 2025, according to Cox Automotive. Buyers had a reason to hurry. The $7,500 federal tax credit was about to expire.
Once it did, EV share fell to 5.8 percent and stayed there through the first quarter of 2026. Sales dropped 27 percent from a year earlier. I have written before about the EV market nobody voted for, and this is what the end of that program looks like on a monthly sales chart.
The industry didn't wait around for a focus group.
Ford ended the current F-150 Lightning and announced nearly $20 billion in charges tied to its electric-vehicle retreat. Honda cancelled the American 0 Series sedan and SUV along with the Acura RSX.
Nissan dropped the Ariya for the 2026 model year. Volkswagen never brought the ID.7 here and skipped the ID. Buzz for 2026.
Some of those vehicles failed because buyers didn't want them. Others disappeared before a buyer could make the choice. The distinction is useful if you're preparing testimony for Congress. It does nothing for the person standing in a showroom.
Hybrids kept selling.
That has been the market's answer for several years now, and I made that case back when the hybrids won. Buyers will accept a battery that improves mileage, adds power and never asks them to reorganize a road trip around a Walmart parking lot. They become less enthusiastic when the battery replaces the engine and adds ten grand to the window sticker.
Audi didn't abandon electricity
The clean version of this story says Audi discovered that nobody wants an EV and ran back to the V8. It would also be wrong.
Audi delivered more than 727,000 vehicles worldwide during the first half of 2026, down a little over 7 percent. Revenue fell from €32.6 billion to €29.2 billion. Operating profit held nearly flat at €1.1 billion, helped by cost cutting and lower provisions for emissions compliance.
In Germany, Audi's electric deliveries rose 23 percent. Plug-in hybrid demand rose 147 percent. European orders for Audi's PHEVs more than doubled.
The company isn't running away from electrification. It is sorting it by customer and price.
The A2 e-tron uses lithium-iron-phosphate cells in a cell-to-pack design and consumes a provisional 12.8 kWh per 100 kilometers with the efficiency package. That makes it the most efficient Audi yet. It is sensible, compact and useful in cities, which is plenty for someone shopping with a calculator.
The Nuvolari uses electrification to turn a Lamborghini-derived V8 into a 987-horsepower event. Its battery could fit beneath a coffee table. The buyer's accountant has probably stopped returning calls anyway.
Between them sits the new RS5, a plug-in hybrid with a twin-turbo V6. An RS6 using a related powertrain is expected to follow. These cars carry enough battery to help Audi with emissions rules and enough engine to keep the people who know what an RS badge used to mean.
Nobody grew up with a poster of a compliance calculation on the bedroom wall. Audi knows it.
The electric sports car problem
There is a hole in Döllner's neat division.
Audi plans to put the Concept C into production as a fully electric sports car. It won't be an inexpensive commuter. It is supposed to carry emotion, desire and all the other things an enthusiast could apparently get from the Nuvolari by spending several hundred thousand dollars more.
Maybe Audi can make both ideas work. A limited-run V8 barely touches the company's fleet arithmetic, while a regular-production sports car does. The Nuvolari gets to be an engine with electrical assistance. The Concept C has to help pay the corporate emissions bill.
It may also prove Döllner wrong. Battery costs continue to fall, electric cars keep getting better, and the first company to build a light electric sports car that doesn't feel like a refrigerator fired from a catapult will deserve the money.
For now, Audi is covering the table.
The factory where the future was built
Volkswagen says it can't guarantee competitive production into the 2030s at four German plants. The list includes Audi's Neckarsulm factory along with Volkswagen facilities in Hanover, Emden and Zwickau. Current production is expected to continue into the next decade, but successor models may go elsewhere or never arrive.
Zwickau is the uncomfortable one.
Volkswagen converted it into its first factory dedicated entirely to electric vehicles. The plant builds the ID.3, ID.4 and ID.5, plus the Cupra Born and Audi Q4 e-tron. It was the physical proof that Volkswagen had moved past diesel and into its electric future.
Now that future needs fewer shifts.
Tariffs are costing Volkswagen billions. China has become a fight against faster local companies with lower costs, and BYD is no longer the name German executives mispronounce before returning to lunch. Volkswagen has too many factories for the number of cars it can sell, a problem much larger than batteries.
They did consume the cushion.
Volkswagen spent years converting factories and building vehicles for electric-sales forecasts that never arrived in the United States. Audi now has a compact EV for the customer watching the price, a V8 hybrid for the customer who isn't, and several plug-in performance cars filling the expensive space between them.
Döllner didn't offer Bloomberg a theory about the future. He described the order sheet.
The battery goes where the customer will accept it. The engine stays where the customer can afford to demand it.
And in Zwickau, the factory that was supposed to prove the argument is waiting to learn whether it gets another car.
Frequently Asked Questions
Speaking to Bloomberg on August 27, 2026, Audi CEO Gernot Döllner said, “We find that the higher the segment is, the more the enthusiast still loves the combustion engine. The lower the segment is, the more battery electric is accepted.” Audi's product plan follows that split, with a compact electric car at the entry point and a V8 hybrid at the top.
The A2 e-tron is Audi's smallest electric car, a compact hatchback built on Volkswagen Group's MEB architecture, the same family of hardware beneath the ID.3. It replaces the A1 and Q2 and debuts in fall 2026. Audi has not announced a price. Its 140 kW version uses lithium iron phosphate cells in a cell-to-pack design and a preliminary 12.8 kWh per 100 kilometers, which Audi calls the most efficient Audi of all time.
The Nuvolari is a roughly $700,000 supercar limited to 499 examples. It uses a 4.0-liter V8 that revs to 10,000 rpm together with three electric motors, for a combined 1,001 metric horsepower, or 987 in American terms, and a 7.3 kWh battery.
No. Audi has walked back its plan to phase out combustion engines in the early 2030s, but it is still expanding electrified models. In the first half of 2026 Audi's electric deliveries in Germany rose 23 percent and plug-in hybrid demand rose 147 percent. The company is sorting electrification by segment and price rather than retreating from it.
Battery-electric vehicles reached 10.5 percent of the American new-car market in the third quarter of 2025 as buyers rushed to beat the deadline, according to Cox Automotive. The $7,500 federal credit expired on September 30, 2025. Share then fell to 5.8 percent and stayed there through the first quarter of 2026, with sales down 27 percent year over year.
Volkswagen has said it cannot guarantee competitive production into the 2030s at four German plants, including Zwickau, Hanover, Emden and Audi's Neckarsulm. Zwickau was Volkswagen's first factory converted to build electric vehicles exclusively and produces the ID.3, ID.4 and ID.5 along with the Cupra Born and Audi Q4 e-tron. Current production is expected to continue into the next decade, but successor models may go elsewhere.
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