Volkswagen Group to invest over 4 billion euros in China in 2020

The Volkswagen Group is betting big on China and how. Next year’s share of investment for e-mobility increases to around 40 percent, paving the way for Volkswagen Group China’s NEV (New Energy Vehicles) offensive.

Volkswagen Group China, together with its Chinese partners, plans to invest over 4 billion euros (Rs 31,824 crore) next year, with around 40 percent of this investment going towards e-mobility. That investment works out to 10,95,890 euros a day or Rs 87.18 crore each day of 2020.

This will accelerate the Group’s electrification strategy, which will be strengthened next year through the start of production of models based on the modular electric drive toolkit MEB in Anting (SAIC Volkswagen) and Foshan (FAW-Volkswagen). Both factories are specifically designed for manufacturing all-electric cars. On November 8, SAIC Volkswagen began pre-production of ID model for China market.

“Today, almost every fifth car sold in China comes from the Volkswagen Group. In a challenging market environment, our strategies are paying off,” said Dr. Stephan Wöllenstein, CEO of Volkswagen Group China. “I am looking forward to 2020, when our local e-car production will significantly increase in scale. Success in e-mobility will be a key driver for reaching our sustainability target, becoming net carbon neutral by 2050.”

Due to the Group’s comprehensive e-mobility strategy, the amount spent on e-mobility will be increased to around 40 percent, in fields such as production, infrastructure, development or research for electric cars. In the next few years, the company generally foresees to spend more on new energy vehicles than on fuel cars. The investment in 2020 will also target Volkswagen Group China’s other goals, including further optimizing its model portfolio, developing new mobility solutions, as well as making advancements in smart cities and autonomous driving.

By the end of this year, Volkswagen Group China will already offer 14 electrified models, while the Group’s comprehensive electro mobility offensive will launch next year. In 2020, production of all-electric cars on Volkswagen’s modular electric drive toolkit MEB will start in Anting and Foshan. They will start MEB-production in October 2020 with a total capacity of 600,000 units per year. Overall, the Group will offer 30 locally produced e-cars by 2025, including achieving 1.5 million e-cars sales by that point.

In 2019, Volkswagen Group China has continued to deliver a solid performance, with this year achieving total cumulative sales of over 42 million vehicles in the China market since first arriving in the country. By October, the Group has delivered 3.34 million vehicles and increased its market share to 19.5 percent (previous year 18,5 percent) in China. Despite headwinds in the market, Volkswagen Group China expects to continue to outperform the overall market and is confident in the long-term potential of the Chinese auto development.

Also read: Volkswagen’s ambitious plans for EVs in China

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