Volkswagen will expand its production of electric vehicles in China to 900,000 units in 2023

According to the German newspaper Welt, Volkswagen will expand the annual production of electric vehicles in China to 900,000 units in 2023.

Volkswagen's target may stem from its poor performance in China last year. Volkswagen's sales of electric vehicles in China last year were 10,000 lower than expected. While encountering fierce competition from local Chinese brands, Volkswagen's sales in its largest market have also been hit by a shortage of semiconductors.

According to the Financial Times, Volkswagen's five flagship ID models sold a total of 70,000 units, most of which were launched in the past year, and the original target sales target for 2021 were between 80,000 and 100,000 units. The entire Volkswagen Group, which includes Audi and Porsche, delivered a total of 3.3 million vehicles in China last year, down 14 percent from 2020.

Stephan W llenstein, longtime CEO of Volkswagen Group China, said: "2021 is one of the most challenging years since we entered China. Feng Sihan will also step down later this year.

China has been Volkswagen's largest and most profitable market for decades, and its two joint ventures with FAW and SAIC have been the growth engines of the group. However, in recent years, due to competition from young Local Chinese brands, Volkswagen's profitability in China has been declining in the past few years.

Volkswagen hopes to sell at least 140,000 ID models in 2022. But Feng Sihan told the media at a recent press conference that "in terms of the semiconductor supply situation we are currently seeing, there is no guarantee at this time" the target figure.

In addition, repeated epidemics are also challenges that they have to face. According to Reuters, due to the new crown epidemic in Tianjin, Volkswagen closed two factories in Tianjin, one of which operates jointly with FAW and the other mainly produces parts. Both factories conducted nucleic acid tests on all employees twice this week, with no infected people.

Volkswagen China's president said he was optimistic about the sales prospects of new energy vehicles, which may be one of the reasons for its annual production of 900,000 units. However, in terms of existing data, the sales of electric vehicles in China are still dominated by domestic brands, and Tesla is the only foreign brand in the top ten sales.

(Proofreading/New)