Volkswagen signs JV with SAIC to make localized EVs for China

German auto brand Volkswagen, which co-owns several vehicle manufacturing plants with SAIC (Shanghai Automotive Industry Corporation) Motor Corporation, Ltd. since the early 90s, has signed a new agreement with the state-owned carmaker – a joint venture to develop and build more electrified vehicles for the Chinese market.

The latest move by Volkswagen also included acquiring a 4.99% stake in Chinese electric vehicle (EV) startup Xpeng, which will provide the software and autonomous driving technology for two upcoming Volkswagen EVs. The marque did not reveal whether the models will be sedans or crossovers/SUVs, but it did specify that it will be launched by 2026, and the target market will be middle-class Chinese buyers.

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As for the joint venture models, Volkswagen said an EV based on the Lavida will be available within four years, followed by 15 other electrified models (plug-in hybrids and battery-electric vehicles). All new electrified models will be built out of the Shanghai Volkswagen Anting plant and will be localized for the Chinese market. There will be more focus on the research of fuel cell vehicles and plug-in hybrids (PHEVs).

Currently, SAIC-Volkswagen has two PHEVs in China, the Tiguan and the Passat. Aside from adding more electrified models for the Chinese market, the joint venture aims to take market share away from EV brands like BYD and Tesla.

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With a more intensive plan to build more PHEVs and EVs, can we expect Volkswagen Philippines to bring in more electrified options?