To seek a competitive edge in producing battery- powered, autonomous vehicles, Volkswagen AG is set to invest $18 billion in China over the next five years.
According to Chief Executive Officer of VW, Herbert Diess who recently replaced previous VW CEO Matthias Mueller:
“We need to speed up. Change is getting faster, more dynamic and more ambitious, especially here in China.”
Announced a day before the opening of Auto China 2018, the additional investments in China amounts to an additional 44 percent on top of the German manufacturer’s own spending. In November 2017, VW, the world’s largest automaker outlined a 34 billion euro ($41.4 billion) investment plan to develop new technology by 2022.
Chinese government has recently signaled to allow foreign automakers to take full ownership of their local ventures instead of the previous rule of allowing no more than 50% in any joint venture in China.
However Volkswagen is planning on continuing its business with Chinese partners and doesn’t plan to change its ownership and in Diess words is “well set up” with its Chinese partners.
Volkswagen announced a 4.2 percent rise in global sales to a record 6.23 million vehicles in 2017. China was the most successful region with 3.18 million cars sold or an increase of 5.0 percent over the previous year
About VW Group
Established in 1937, VW Group is probably the largest automobile company that manufactures and sells automobiles primarily in Europe, North America, South America, and the Asia-Pacific together with its subsidiaries. Headquartered in Wolfsburg, Germany, VW Company operates through four segments: Passenger Cars, Commercial Vehicles, Power Engineering, and Financial Services. VW group employs around 642292 employees worldwide.