Ralf Brandsatter, VW’s China chief executive, told reporters at a media briefing on Monday that the German carmaker is targeting 4 million deliveries annually to mainland customers by 2030, which could account for about 15 per cent of the overall market.
Volkswagen has been a perennial market leader in China’s automotive industry since it established a Shanghai-based joint venture in 1984, delivering 3.2 million cars – the vast majority petrol-powered – on the mainland last year, up 1.6 per cent from 2022.
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Cheap EV alternative to Tesla and BYD takes off in small-town China
Cheap EV alternative to Tesla and BYD takes off in small-town China
“We want to remain the No 1 international OEM [original equipment manufacturer],” he said. “In China, we want to be on par in cost and tech with local players with a profitable and healthy business model.”
OEM is a term favoured by many in the industry to refer simply to car assemblers.
It reported sales of 191,800 electric cars in China last year, up 23.2 per cent from 2022.
However, Volkswagen’s share of the broader Chinese vehicle market slipped to 14.2 per cent in 2023, down 0.6 percentage points from a year earlier, according to data compiled by the China Passenger Car Association.
New-energy vehicles (NEVs) – a term that captures fully electric and plug-in hybrid cars – will make up about half of new car sales in mainland China by 2030, as state incentives and an expanding network of charging stations win over more customers, Moody’s Investors Service said in a research report released early this month.
“We expect that by 2026, we will be fully competitive compared with the best players in terms of ADAS [advanced driver assistance systems] and other smart technologies,” Brandsatter said.
He expects VW to launch 20 new electric models for the Chinese market in the next three years.
Volkswagen aims to reduce the time it takes to develop its cars by more than 30 per cent while cutting costs by up to 40 per cent as it beefs up its investment in China’s EV sector.
The new EVs, bearing the VW badge, will be designed and built based on “joint purchasing activities” and sharing of technologies, the two companies said. VW owns 5 per cent of Xpeng following a US$700 million investment last year.
The carmaker has partnered with other Chinese companies too, including autonomous driving tech firm Horizon Robotics and ThunderSoft, an in-car entertainment developer, to create a new generation of EVs.
It owns three carmaking ventures across the mainland, with state-owned Chinese companies FAW, SAIC and JAC.
VW also owns a 25 per cent stake in Gotion High-Tech, a leading Chinese EV battery producer.