Volkswagen's Scout Motors unveils its first electric vehicles as it transitions to incorporate plug-in hybrids.

• On Thursday, Scout Motors, a subsidiary of Volkswagen, unveiled its first two vehicles: a Traveler SUV and Terra pickup truck, set to be released in 2027.
• The American brand Scout, which existed from 1961 to 1980, was predicted to focus solely on electric vehicles (EVs) in an attempt to increase its market share in the U.S. by the German automaker.
• According to Scout, both the Traveler and Terra are anticipated to begin with a budget between $50,000 and $60,000, with incentives available.

In Nashville, Tennessee, Scout Motors unveiled its first electric vehicles and disclosed plans to expand its product range to include a new type of plug-in hybrid electric vehicle, in addition to its existing electric vehicle models.

In an attempt to expand its presence in the U.S., the German automaker planned to exclusively offer EVs through Scout, an American vehicle brand from 1961 to 1980. However, due to slower-than-expected adoption of EVs and higher costs, Scout has changed course and now offers extended-range electric vehicles, or EREVs.

"As a fast-moving startup, we have the ability to pivot, according to Scout CEO Scott Keogh, a former VW executive who now leads the company. The pivot we made into offering range extenders was a wise decision."

Plug-in hybrid electric vehicles (PHEVs) are a type of EREV that feature EV motors and battery cells, along with a traditional internal combustion engine to power the vehicle's electric components when the battery runs out of energy. The engine functions as a generator to power the EV components when necessary.

Scout added EREVs to safeguard the brand from market fluctuations due to lower-than-anticipated consumer demand for EVs, as stated by Keogh.

""An EV car with a range extender is the future, as it introduces people to electrification and has a smart backup plan. It will drive like an EV," he said during an interview Thursday."

Scout has no plans to provide a traditional, non-electric vehicle powered solely by an internal combustion engine, as stated by him.

The U.S. sales market will be covered by approximately 40% through the company's initial vehicles, which are a full-size pickup truck and large SUV.

Keogh stated that the company aims to achieve profitability on an operational basis in the first full calendar year following the initial production of vehicles, which will be manufactured at a $2 billion plant currently under construction in South Carolina.

Keogh stated that the two areas, ranging from a pickup truck to an SUV, are the largest profit pools globally.

During the specified timeframe, achieving profitability would be a significant accomplishment, as many current EV startups, including and , incur tens of thousands of dollars in losses on each vehicle they produce after several years.

Scout's operations will not be affected by the announced software deal between VW and Rivian, as Keogh described the $5 billion deal, which includes the formation of a joint venture, as an "exciting opportunity" for Scout.

Keogh stated that it is beneficial for scaling, technology, and everything else.

Scout's South Carolina plant will have a production capacity of 200,000 vehicles, with VW's joint venture battery cell manufacturer in Canada supplying the most expensive part of the electric vehicles, the batteries.

The company made reservations for vehicles available on its website on Thursday night. Instead of selling through franchised dealerships like VW does in the U.S., Scout plans to sell directly to consumers.

New SUV, truck

In 2027, the first two vehicles for Scout will be the Traveler SUV and Terra pickup truck.

The company unveiled "production-intent concept vehicles" in Nashville, Tennessee on Thursday, indicating that they are likely to be the same vehicles that will be sold.

According to Scout, both the Traveler and Terra are anticipated to begin between $50,000 and $60,000, with incentives available, while pricing details for the EREVs were not disclosed by the company.

Keogh stated that the Traveler SUV is predicted to contribute two-thirds of the company's initial sales.

The EREV vehicles will have a longer range of over 500 miles, compared to the all-electric models' range of 300 miles, according to the company.

The Traveler and Terra are updated versions of previous Scout vehicles, with sleeker and more fashionable exteriors. Their interiors boast big horizontal displays and comfortable, soft-touch materials.

In 2021, VW acquired the Scout trademark and name after purchasing Navistar, a successor of Scout's original owner International Harvester, for $3.7 billion.

The company announced that its fully electric Scout vehicles can climb 100% grades, accelerate from 0-60 mph in just 3.5 seconds, and deliver nearly 1,000 lb.-ft. of torque.

The vehicles will employ the North American Charging Standard, an 800-volt architecture with a maximum charging capacity of 350 kilowatts, and will have the ability to charge bi-directionally, enabling the vehicle to function as a generator.

Tough market, competition

The SUV is anticipated to rival traditional off-road SUVs from Jeep, Ford Bronco, and Land Cruiser. Despite being larger than Jeep's Wrangler, which is currently offered as a plug-in hybrid electric vehicle.

While the full-size pickup market is currently dominated by Ford and Ram, the electric pickup market, where Scout will compete, is still in development.

In order to compete against EV startups and those that never came to fruition, automakers such as GM and Ford released all-electric pickup trucks early in this decade. Stellantis is predicted to release all-electric and EREV full-size pickups by next year.

Sales of large vehicles slowed after rushing them to market, mirroring the decline in the EV industry's pricing premiums.

Nearly 58,000 electric trucks, including SUVs, were sold in the first half of the year, accounting for less than 1% of the 7.9 million light-duty new vehicles sold in the U.S. However, this represents a 35% quarterly increase from the first to the second quarter, according to Motor Intelligence's estimates.

Keogh believes Scout can stand out in the market with its offerings, competitive pricing, and strong brand image. In the future, Keogh expects Scout to introduce more products.

"Can we discuss the possibility of downsizing in the future?" he asked. "You want to aim for the best spot first, and I believe we've achieved that with these two vehicles."