Volkswagen Anhui Automotive, a Chinese joint venture owned by German car giant Volkswagen, has started producing its first cars, a pure electric sports utility vehicle model destined for the European market.
The coupe sports utility vehicle Cupra Tavascan is part of Volkswagen’s Spanish marque Seat and is based on the firm’s MEB platform, the Hefei, eastern Anhui province-based JV said recently. Sales are expected to top 70,000 units a year.
Another Volkswagen model should also start to be produced in China this year, Ralf Brandstätter, chief executive officer of Volkswagen Group China, said in July.
Volkswagen Anhui was set up in 2017 and is the German carmaker’s third joint venture in China, but unlike the other two, the Wolfsburg-based company is majority shareholder. Volkswagen raised its stake to 75 percent from 50 percent in 2020 after China allowed foreign carmakers to hold a majority stake. Jianghuai Automobile Group owns the remaining equity.
In the last few years, Volkswagen has been notably hiking its investment in China, which is its biggest single market. This is possibly due to changes in the country’s electric car market and also to stem sliding sales, analysts said.
Volkswagen’s shipments in China dipped 3 percent in the nine months ended Sept. 30, 2023 from the year before to 2.3 million units. It was the firm's only market to log a drop in sales but still accounted for 34.1 percent of global shipments. Volkswagen sold 120,000 EVs in China over the period.
In May, Volkswagen said it will invest around EUR1 billion (USD1.1 billion) to set up a wholly-owned unit in Hefei that will focus on the R&D of intelligent connected autos. Volkswagen Anhui’s Chief Finance Officer Jürgen Hasenpusch said the same month that the company will pump an additional CNY23.1 billion (USD3.2 billion) into Hefei.
And in November, Volkswagen China said it would launch new EV models tailored for the Chinese market from 2026. The new platform will have a development cycle of 36 months, about one-third shorter than its existing development cycle.
