VW's once all-electric Scout brand sees big demand for hybrid models

March 4 (Reuters) - Volkswagen’s new Scout Motors brand has taken more than 160,000 reservations for its first model, with most customers opting ‌for an extended-range hybrid version instead of full electric, a top executive ‌said on Wednesday.

Scout will begin building prototype models this year at a plant the automaker is ​constructing in South Carolina, Scout CEO Scott Keogh said at an Automotive Press Association event in Detroit.

Of the 160,000 reservations, 87% are for a so-called extended-range EV, or EREV, a version of the rugged Scout models, reflecting the dimmer outlook ‌for fully electric vehicles in ⁠the U.S. An EREV uses a small gas engine that serves as a generator to recharge the vehicle’s large battery ⁠on the go.

VW introduced Scout as a fully electric brand in 2022, but reversed course to add EREVs a few years later, as U.S. EV sales growth was ​decelerating.

Scout ​previously said it would start production in ​2027, though recent media reports have ‌said the rollout has been delayed because of technical challenges. Keogh said on Wednesday he expects products to be in customer hands by 2028.

Volkswagen is hoping the Scout brand will help it grow market share in the truck-and-SUV-heavy U.S. market, where the German automaker has long struggled to make inroads despite being ‌among the world’s largest car companies. VW ​ranked 11th in U.S. vehicle sales last year, ​behind Tesla, according to research ​firm Motor Intelligence.

On Tuesday, two Volkswagen dealers in the U.S. ‌sued the company over its decision to ​sell Scout vehicles ​directly to consumers, claiming that breaches the automaker’s contract with its retailers. The lawsuit is seeking class-action status.

A VW spokesperson said the company does ​not comment on active ‌litigation.

Keogh said the direct-to-consumer model “made the most sense, without a doubt,” ​when looking at the American market.

(Reporting by Kalea Hall in Detroit; ​Editing by Mike Colias and Emelia Sithole-Matarise)