Volkswagen is preparing for a permanent decline in its China operations. Ralph Brandstätter, VW’s head in China, told the “Handelsblatt” that the overall market in China is “in free fall.”
Due to the slump in overall demand, the world’s second-largest automotive group could only sell around 2.2 million cars annually in China by 2030. Previously, Brandstätter had targeted 3.2 million units for that period, and in peak times, VW had sold over four million cars in China as a whole.
The drop in demand is significant: deliveries fell by 30 percent in the first nine months of this year, dropping below 1.4 million vehicles. Furthermore, VW is likely to fall below the two-million-vehicle sales mark in China for the first time since 2010. Brandstätter stated, “China is no longer a growth engine. We are preparing for that.”
In response, Brandstätter is focusing on increased exports of cars from China to various global regions. While the manager did not disclose specific export targets, he affirmed that exports are becoming increasingly crucial even for VW. Beyond finished vehicles, the company plans to export “made in China” technology, including platforms, electronic architectures, and software, to other markets. According to Brandstätter, this approach allows development costs to be distributed across larger vehicle volumes.
