The largest auto market in the world hasn’t smiled at the Volkswagen Group. In China the 2021 goals of the Wolfsburg brand and its subsidiaries, as a whole, have not been achieved; opponents in electric format have gained ground and the prospects for 2022 are not particularly good given the current conditions.
According to reports Automotive News, the Volkswagen Group has sold 70,000 electric cars of the ID family in China; at least ten thousand less than the target (estimated between 80,000 and 100,000 registrations). In total it sold 3.3 million cars, with a drop of 14%: this figure also failed to meet the objectives. Ultimately, according to Stephan Wollenstein, head of Volkswagen’s Chinese division, the brand has operated under a substantial loss in the great Asian country, in the face of various investments made in recent years. The disappointment is even greater whereas Chinese electric brands Nio, Xpeng and Li Auto have sold more overall than VW, despite being ‘small’ in comparison. Not to mention BYD, which is performing well.
Volkswagen would like to double the share of electric cars sold by 2022, but it has already got its hands on: management believes the semiconductor crisis (the reason, according to Wolfsburg, for lackluster results) will continue, reducing productivity and consequently reducing availability and deliveries. Volkswagen builds the Chinese IDs thanks to the joint-ventures established with SAIC and FAW, but this does not seem of particular relief; moreover, Covid did not help, given the recent quarantine closures of production plants (including related industries).
There would be room for maneuver: the Chinese electric market accounts for between 15 and 20% of the total number of cars sold. But a more local strategy will probably be needed, possibly with a greater focus on services around the sale, to have a better chance.
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