Volkswagen to invest €4 billion in China

China
Published:  28 November, 2019
Volkswagen Chattanooga

Aiming to accelerate its electrification strategy, the German automotive Group said it plans to invest over €4 billion in China in 2020, with around 40% of this investment going towards e-mobility.

The investments concern production, infrastructure, development or research for electric cars. Volkswagen said it generally foresees to spend more on new energy vehicles than on fuel car in the next few years. The investment in 2020 will also target Volkswagen Group China’s other goals, including further optimising its model portfolio, developing new mobility solutions, as well as making advancements in smart cities and autonomous driving.

“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, 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.”

According to Volkswagen, the production of each of its vehicles today is 37% more environmentally compatible than in 2010. The Group said it is also making good progress towards attaining the target of improving manufacturing productivity by 30% over the period 2016 to 2025 and, this year, productivity is expected to be 6% above the prior year level, with production sites outside of Germany having made the most significant contributions.

Volkswagen has recently announced the start of construction for its electric vehicle production facility in its U.S. Chattanooga site, where production begins in 2022 and will be Volkswagen's North American assembly base for electric vehicles on the Modular Electric Drive Matrix (MEB). The US$800 million expansion investment is expected to create an additional 1,000 jobs. The carmaker has also converted its Zwickau factory in Germany to a full electric plant, and production of its new ID.3 begun on November 4.