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Since Volkswagen accelerated its electrification transformation, it has announced the opening of a total of three electric vehicle plants in China, its largest single market. Thanks to the smooth progress of the plan, the Volkswagen Group's third pure electric vehicle MEB plant has also officially opened recently, which is expected to be completed by mid-2022.

It is understood that the factory is the third pure electric vehicle factory established by the group in China after SAIC Volkswagen Anting and FAW-Volkswagen Foshan MEB plant. According to the previous plan, the future model of Volkswagen (Anhui) will be based on the group's pure electric MEB platform, with the first model scheduled to start production in 2023 and five models by 2025. According to Volkswagen China's plan, Volkswagen China plans to sell about 1.5 million new energy vehicles a year by 2025.

At the same time, it is also learned that the Anhui factory to be started this time will mainly carry out renovation and expansion on the original workshop (formerly under Jianghuai Automobile Group). The project covers a total area of 500000 square meters, of which the new body workshop is expected to cover an area of about 141000 square meters. In addition, the project also plans to build a battery and parts supplier park in the plant to shorten the launch cycle of new electric models.

At the same time, Volkswagen Anhui is also actively expanding its local talent reserve. It is estimated that in 2025, Volkswagen Anhui will employ about 500 employees to participate in R & D, production and other work.

In fact, the plan was first signed by Anhui State-owned assets Supervision and Administration Commission, Volkswagen China Investment and Jiangqi Holdings in May 2020. Volkswagen China will acquire a 50% stake in Jianghuai Automobile Holdings through capital increase. At the same time as taking a stake in Jianghuai Automobile Group, Volkswagen also announced that it would increase its stake in JAC Volkswagen to 75%, giving Volkswagen a controlling stake in the joint venture.

Volkswagen China Investment and JAC Automobile contributed in accordance with the agreement on December 2, 2020, resulting in Volkswagen (Anhui) Co., Ltd. officially owned by Volkswagen China Investment 75%, JAC Automobile 25%.

In order to promote the product layout of Jianghuai Volkswagen, Jianghuai Motors also signed the Product portfolio Framework Agreement with Volkswagen China, which stipulates that Volkswagen becomes a 75% shareholder in the joint venture company. 4-5 Volkswagen Group brand products will be awarded to the joint venture company, and the planned products will be based on its pure electric platform.

At the same time, the portfolio Framework Agreement also involves a production plan with an annual production capacity of 350000 vehicles, which is expected to produce 20-250000 vehicles in 2025 and 35-400000 vehicles in 2029, with total revenue expected to reach 30 billion yuan in 2025 and 50 billion yuan in 2029.

Since Volkswagen China signed a contract with Jiangqi Holdings at the end of May last year, Volkswagen bought a stake in Jianghuai Volkswagen and increased its capital to Volkswagen. It has been less than a year since Volkswagen's Anhui plant was built. some in the industry believe that this plan shows the urgent need for Volkswagen to deploy new energy vehicles and electrify strategic transformation in China.

After all, Volkswagen's actions since the announcement of the transformation are also more radical in the industry. In addition to investing a lot of money in the electric sector, it is also trying to catch up with electric carmaker Tesla and regain its market position. Volkswagen CEO Dis had previously shouted at Tesla and Musk on social media, saying it would "snatch" part of the competitor's market share.

At the same time, the company has set a target that by 2030, about 50 per cent of total sales will come from all-electric vehicles, which is no longer the target of about 25 per cent set not long ago, and will invest about 16 billion euros by 2025, with sales of more than 1 million electric vehicles and more than 70 electric models to be launched by 2029.

Volkswagen also believes that as Jianghuai Volkswagen introduces Volkswagen products, it will complement and coordinate with FAW-Volkswagen and SAIC-Volkswagen, the other two Volkswagen joint ventures in China. At present, FAW-Volkswagen and SAIC-Volkswagen are also gradually expanding their layout in the new energy electric market. However, some in the industry believe that because Volkswagen owns more shares in Volkswagen's Anhui province, it will be able to restrict the other two joint ventures as the factory's model share in the market increases.

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