Austrian newspaper Kleine Zeitung cited people familiar with the matter as saying that the Volkswagen Group has given Magna Steyr an order worth 450 million euros to develop models. The newspaper said VW’s order was Magna Steyr’s largest vehicle development contract to date. Magna Steyr, a company specializing in off-road vehicles, already produces the G-Class sedan for Mercedes-Benz in Graz, Austria.

According to a report by Kleine Zeitung, Magna engineers in Graz and the United States are already working on the Scout model and plan to have two models ready for series production by the end of 2026 after extensive prototype testing. A spokesperson for Magna in Europe told Automotive News Europe that the company does not comment on outside speculation.

In order to boost sales in the North American market, Volkswagen Group said in May last year that it would relaunch the Scout brand in the United States to provide new electric pickup and SUV products. In March this year, Scout announced that it would invest $2 billion to build a factory in South Carolina, USA.

Scout said at the time that it hoped to eventually create 4,000 jobs and produce 200,000 Scout vehicles a year. Volkswagen Scout factory is scheduled to start construction in mid-2023, and production is expected to begin before the end of 2026. In addition, the plant received $1.29 billion in incentive subsidies from the state of South Carolina.