Volkswagen Group China has increased its commitment to launching New Energy Vehicles (NEVs) in China on the eve of the Guangzhou show which opens Friday.
At Guangzhou last year, the group announced its strategy to deliver 1.5m NEVs annually by 2025 and launch 15 locally produced NEVs in the next two to three years. Under TOGETHER – Strategy 2025 and Roadmap E, this commitment to China has now been further strengthened. The company will introduce "in excess of" 20 more NEVs between 2020 and 2025, creating a NEV portfolio of almost 40 locally produced models in China in the next seven to eight years.
Go deeper with GlobalData
Discover B2B Marketing That Performs
Combine business intelligence and editorial excellence to reach engaged professionals across 36 leading media platforms.
To meet this enormous requirement for battery capacity, the group has started a global tender process for long-term strategic partnerships – including in China.
The group and its joint venture partners – which include SAIC and FAW will spend EUR10bn on the industrialisation of e-mobility between now and 2025.
Jochem Heizmann, president and CEO of Volkswagen Group China, told a press conference: "China is leading the way to the final breakthrough in the adoption of e-mobility and the group is determined to be at the forefront. Together with our long-term joint venture partners SAIC VW and FAW-VW, and our new cooperations, we are transforming the future of mobility and, in regard to the needs and demands of our customers, we will deliver."
The event also welcomed a third vehicle manufacturing joint venture partner, JAC. The new joint venture will help VW reach its goal of setting up a broad and customer oriented range of pure battery cars by producing vehicles for the competitive mass market. The first model will hit the market next year.
The group also announced the establishment of the brand Ezia to provide intelligent mobility services in China. This brings together all the activities of Mobility Asia, a member of the group.
"It will create an innovative dual ecosystem that provides customers with seamless access to a wide range of smart mobility services," VW said.
A Reuters report noted China's NEV production and sales quotas, which must be met by 2019, have prompted a flurry of electric car deals and new launches as automakers in China race to ensure they do not fall short. Automakers that do fall short will be required to buy credits.
Volkswagen currently has around 10 NEVs already on the market in China, although all are imported models with limited sales volumes, a company spokeswoman told the news agency.
Heizmann told Reuters the group was aiming to sell 400,000 NEVS a year in China by 2020.
He said some of those models would have a 400-600km driving range on a single full charge. By comparison, Tesla's Model S has a range of 490km and as much as 632km depending on battery capacity, according to the company.
The group was also confident that its group companies and their local China joint venture partners would be able to generate enough NEV sales volume to account for NEV quotas by 2019, Heizmann told Reuters, adding that there would be no need to buy credits.
"We need high volumes of new energy vehicles… we are working on full speed on that."
Reuters noted General Motors' China chief Matt Tsien last week said GM's China joint ventures would be able to generate enough NEV sales volume to account for NEV quotas by 2019 and without the need to buy credits.
Tsien said both GM and its China joint venture partners "are working to at least meet, if not exceed, those credit mandate requirements".
VW said Chinese buyers would be offered "at least" 10 SUV models by 2020. With the long-term focus on e-mobility, the brand would offer a full range of more than 10 NEV vehicles by 2020, based on existing models like the e-Golf, which will be on sale early in 2018. This will feature a unique, integrated, China specific charging app, underlining the actions the brand is taking to ensure all new models leaving showrooms by 2019 will be fully connected. From 2020, the completely new ID family of electric only cars would form the core of VW's electric model range in China.
Audi
"By the end of 2020 we will offer six additional SUVs in China including two models with fully electrified drive trains," said Joachim Wedler, president of Audi China. "All of these six models will tap into new segments. And the new Q8 [shown in concept form in China] will be one of them."
The Q8 is due on sale in 2018 and, VW said, "is a perfect fit to the booming Chinese SUV market".
Skoda
Skoda is launching the Karoq SUV at the Guangzhou show and plans three more new SUVs next year, to further strengthen its growth in China in the coming years.
The Guangzhou auto show starts on Friday.
