Audi has scrapped its plan to phase out internal combustion engine (ICE) models by 2032, confirming that it will continue producing both ICE and plug-in hybrid (PHEV) models alongside electric vehicles (EVs). The move reflects a shift in strategy as market conditions indicate a slower transition to full electrification.
Speaking at Audi’s Annual Media Conference for 2025, CEO Gernot Döllner acknowledged that while EV development remains a priority, combustion engines will remain in production based on global demand.
“As part of our product initiative, we are not only launching new electric models, but also a new generation of combustion engine vehicles and plug-in hybrids,” he said.
“We will manage the production of our last combustion engine vehicles depending on various developments in world markets.”
Combustion remains key
Previously, Audi had committed to ending ICE development by 2026, with the next-generation Q7 expected to be its final combustion-powered model. However, the revised strategy follows the lead of brands like BMW, Mercedes-Benz and Volvo, which have opted for a more flexible approach to electrification. Even Porsche plans to keep ICE models in production into the 2030s.
PHEVs will also play a bigger role in Audi’s lineup for the foreseeable future. Döllner highlighted that “a central part of our portfolio as we move towards an all-electric range” will include hybrid models, ensuring a gradual transition rather than an abrupt shift.
New model launches
Audi is in the midst of a significant product overhaul. By the end of 2025, the brand aims to have the “youngest portfolio in our market segments.”
The next-generation Q3 is set to arrive in mid-2025, following the recent A6 Avant launch. Additionally, a plug-in hybrid A5 will debut on March 25, one of 10 new PHEVs Audi plans to introduce this year.
In North America, Audi will roll out 10 new models by the end of 2025 while exploring local production options to mitigate the impact of US trade tariffs.
Meanwhile, in China, the brand is intensifying its partnership with FAW and SAIC to strengthen its foothold in both the combustion and EV segments.
Challenges ahead
Despite the optimism surrounding its revised lineup, Audi acknowledges the difficulties ahead. CFO Jürgen Rittersberger described 2025 as a “very challenging year” due to ongoing geopolitical and economic uncertainties.
However, he remains confident that Audi’s refreshed range will drive continued success as new models reach global markets.
Audi’s decision to keep ICE and hybrid models in the mix reflects a pragmatic response to evolving consumer demand. While the brand remains committed to electrification, it recognises that the journey to an EV-only future will take longer than initially anticipated.