CEO of the Volkswagen Passenger Cars brand Ralf Brandstaetter announced through Nikkei that the company will be able to manufacture one million electric vehicles in China. After a long time, VW in China seems to be moving ahead. The factory, a joint venture with China’s Anhui Jianghuai Automobile Co (JAC) will be able to manufacture one million vehicles starting from 2023.
China’s Anhui Jianghuai Automobile Co (JAC) first announced in 2019, is set to produce 300,000 electric cars a year, with production starting in 2023. Now, the announcement comes as the production from two further joint venture plants – one with FAW Group, and one with SAIC Motor – this is expected to bring total capacity to the 1 million mark, Brandstaetter said.
In late August 2018, Volkswagen Group opened its new FAW-Volkswagen plant in Tianjin. SUV models, including plug-in hybrid versions, were produced here for the Volkswagen and Audi brands. However, the brand in China has not grown in the local areas. The German automaker sold 70,625 of its ID electric vehicles in China last year, missing its goal of selling 80,000 to 100,000 cars, with production also affected by regional COVID-19 outbreaks in addition to chip-related issues.
Doubling production
Back in January this year, the automaker stated about their aim to double the ID battery vehicle production. The ID series, which Volkswagen produces at its Chinese joint ventures with SAIC Motor and FAW Group, is the backbone of its EV ambitions in China, the world’s largest auto market.
Volkswagen’s China chief Stephan Wollenstein told in the briefing in January that the automaker would still like to double its original plan. But added that goal “is not currently secured by the semiconductor supplies that we currently see.”
Now Brandstaetter told Nikkei, “In the past, our approach was to develop in Germany and localize in China. But this approach will be changed significantly by setting up more local resources for R&D, especially for software, to be faster, to be more independent in China.”
China is known to be one of the markets with large potential. Volkswagen Group, which alongside its own brand owns other marques such as Audi, Lamborghini, and Porsche, sold 3.3 million cars in China last year. The company aims to boost that number by around 15% or roughly 500,000 units this year. The shortage of chips, used in everything from brake sensors to power steering to entertainment systems, has led automakers around the world to cut or suspend production, pushing up both new and used vehicle prices amid robust demand from consumers.
Credits- Reuters, Nikkei
