Volkswagen targets dominance in Europe with affordable EV push

The chief executive of Volkswagen says the German auto giant is pushing to strengthen its electromobility dominance in Europe with a new lineup of compact and affordable electric vehicles.

Volkswagen, the largest supplier of electric cars in both Germany and Europe this year, unveiled the small all-electric ID. Cross Concept car over the weekend, before a roll-out into the market in the first half of next year.

This is Volkswagen's fourth launch in a family of new electric models, following the ID.2 all, the ID. GTI Concept and the ID. EVERY1.

"We have worked hard during the last years to improve our software, to improve our battery offerings. This family will be the first where we are introducing our unified cell concept in terms of battery," Volkswagen CEO Oliver Blume told CNBC's Annette Weisbach on Monday.

"We will be competitive and right now, in Europe, for example, we are a market leader by far in electromobility with 28% market share. This family is another push to making this market share even bigger," Blume said.

Volkswagen's ID. Cross Concept car will have an entry price level of around 25,000 euros ($29,316), Blume said.

His comments come shortly before the kick-off of the IAA Mobility car show in Munich, where struggling European carmakers are expected to face off with Chinese newcomers.

Shares of Volkswagen are up around 12.2% so far this year, despite U.S. tariff pressures on the European auto industry.

Asked about the robust competition posed by Chinese EV rivals, Blume said he welcomed the challenge.

"Competition, for me, is very positive. It is like in sport: when you have good competitors, you have to be better. That's what we have been prepared to do in the last years, in terms of improving ourselves," Blume said.

"I don't fear the competition," he added.

Europe's auto sector is currently facing a multitude of challenges, from rising production costs to U.S. tariffs, as well as supply chain disruptions and regulatory pressures.

As Mercedes-Benz Group CEO Ola Källenius recently put it: "Our industry is experiencing heavy rain, hail, storms and snow at the same time."

Volkswagen's Blume welcomed a recent trade breakthrough between the U.S. and European Union, with an agreement expected to bring U.S. auto import tariffs to 15%, down from 27.5%.

The new tariff rate, however, will still be a "burden" for the company, according to Blume, who added that the company intends to continue investing heavily in the U.S.