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23.1 billion RMB! Volkswagen announces heavy investment in China

2024-03-04 Update From: AutoBeta autobeta NAV: AutoBeta > News >

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AutoBeta(AutoBeta.net)05/28 Report--

On May 28th, at the launching meeting of the series of activities of "investing in Anhui", Haryogan, chief financial officer of Volkswagen Group (China) Volkswagen Anhui, said that Volkswagen Anhui will continue to invest in Hefei, Anhui, with a total planned investment of 23.1 billion yuan. the total investment in fixed assets between the production base (phase I) and the R & D center is 14.1 billion yuan, and the total investment in research and development before the model is on the market is about 9.05 billion yuan.

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It is understood that Volkswagen (Anhui) Co., Ltd. is located in Hefei, Anhui Province, established in 2017, with a registered capital and paid-in capital of 7.35561528 billion yuan. The company is a joint venture between Volkswagen (China) sales Co., Ltd. and Anhui Jianghuai Automobile Group Co., Ltd. it is the first joint venture of Volkswagen Group in China to focus on new energy vehicles, its predecessor is Jianghuai Volkswagen. At the beginning of its establishment, Volkswagen and Jianghuai Automobile each held 50%. In May 2020, Volkswagen China acquired 50% of JAC Holdings, the largest shareholder in JAC, and increased its stake in JAC Volkswagen to 75%. Since then, JAC Volkswagen Co., Ltd. has changed its name to Volkswagen (Anhui) Co., Ltd.

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According to the agreement signed at that time, Volkswagen will grant 4-5 Volkswagen Group brand products to the joint venture after it owns 75 per cent of the joint venture company; it is expected to produce 20-250000 cars by 2025 and 35-400000 cars by 2029; total revenue is expected to reach 30 billion yuan by 2025 and 50 billion yuan by 2029. In addition, in September last year, Volkswagen announced the 2023 strategy to launch the SSP pure electric platform in Volkswagen Anhui, which will build new Porsche cars including Audi grandsphere, Volkswagen Trinity and Porsche positioned higher than Cayenne.

It should be noted that before announcing its investment in Hefei, Anhui Province, Volkswagen Group announced at the Shanghai Auto Show in April that it would invest about 1 billion euros to establish a wholly-owned new company in China, and the new company would be located in Hefei. According to previous reports from Automotive Industry concern, the new company's project, named "100%TechCo", focuses on the R & D, innovation and procurement center of intelligent network-connected electric vehicles, and will cover vehicle development, parts development and procurement functions in the future. The company is expected to start operation at the beginning of 2024. After operation, the development cycle of Volkswagen's new products and technologies will be gradually shortened by about 30%. Research and development projects in joint ventures of SAIC Volkswagen, FAW-Volkswagen and Volkswagen Anhui will achieve closer coordination.

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As for why Volkswagen Group invested so heavily in Volkswagen Anhui? Auto Industry concern believes that it may be related to the current changes in China's electric car market and the performance of Volkswagen Group's electric vehicle sales in China. Earlier, Obom, chairman of the management board of Volkswagen Group, said bluntly in an interview with the media that Volkswagen set up a new "100%TechCo" company in China because it saw the rapid development of China's auto market, and Volkswagen wanted to run faster and faster in the new track competition like athletes. In addition, GE Wanqu, CEO of Volkswagen (Anhui) Co., Ltd., also pointed out: "We choose to take root in Hefei, which can be explained by an old Chinese saying, 'weather, geography, people and people'. We hope to help Hefei become the future capital of new energy vehicles, and Hefei's high-quality resources can also help us better focus on the field of new energy vehicles. "

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Volkswagen Anhui vehicle Manufacturing Base

Volkswagen Anhui is Volkswagen Group's third automobile production base in China after Anting in Shanghai and Foshan in Guangdong, but unlike the first two factories, Volkswagen Anhui only focuses on the R & D and production of new energy vehicles. Earlier this month, foreign media reported that Tavascan, the first pure electric model of Volkswagen Group's brand Cupra, will be manufactured in a joint venture plant in Anhui, which will be the first car produced by Volkswagen's Anhui factory. The Cupra pure tram, built on the Volkswagen MEB platform and positioning the sedan SUV, is expected to be launched and exported to the European market in 2024. Volkswagen Group expects the brand to sell more than 70, 000 vehicles a year.

The Chinese market is Volkswagen's largest single market in the world, but Volkswagen is also under great pressure as the domestic car market changes. Chinese brand BYD became the top seller of domestic passenger cars with 1.805 million vehicles in 2022, ending the 40-year dominance of joint ventures such as North and South Volkswagen, according to data. Among them, Volkswagen Group's global new car sales were 8.2826 million in 2022, down 7.0% from the same period last year and the lowest in 11 years. From a regional perspective, Volkswagen delivered 3.1845 million new cars in the Chinese market, down 3.6% from a year earlier. But China is still the largest contributor to the group's global pure electric vehicle sales growth, with Volkswagen delivering 155700 pure electric vehicles in China in 2022, up 68.2% from the same period last year.

The first ID since the end of 2020. ID that Volkswagen is selling in China since the introduction of electric cars into China. Family models include ID.3, ID.4CROZZ, ID.4X, ID.6CROZZ and ID.6X. According to Volkswagen's plan, Volkswagen Group's brands, including Volkswagen and Audi, will offer more than 30 pure electric models in China by 2030.

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