Volkswagen has inked an agreement with its Chinese partner, SAIC Motor to research and produce electrified cars for the Chinese market.
With the announcement, Volkswagen is also agreeing to expand its manufacturing facilities to accommodate the added production of a new model – a compact car based on the Volkswagen Lavida, VW’s top seller in China – and leading to the production of future plug-in models (hybrid and fully electric). Volkswagen currently has 20 vehicle and component production facilities in the country.
"Together with our long-standing partner SAIC, we are consistently forging ahead with advanced, environmentally compatible technologies. With these technologies, we will shape the automobile future of China. One of the main emphases is on electro-mobility," said Prof. Dr. Martin Winterkorn, Chairman of the Board of Management of Volkswagen at the announcement.
The Lavida is related to the Golf/Jetta in platform and size, leading to speculation that a fully electric Jetta may be only four years down the road.
"Today's agreement lays the foundation for the further expansion of our commitment to Chinese society and the environment,” added Prof. Dr. Jochem Heizmann, President and CEO of Volkswagen Group China. “Over the next four years, we plan to localize more than 15 different electric vehicle models in China, including plug-in hybrids and fully electric vehicles.”
In addition to expanding the Anting plant (located west of Shanghai) to accommodate the added production of the new model and future electric vehicles (anticipated within four years – by the 2020 model year), the agreement also means further research and development into fuel cells and plug-in hybrids.
The new model to come out of Anting will be the first fully electric vehicle produced at the plant. It is destined for the Chinese domestic market, but the company is not ruling out the possibility for worldwide distribution, depending on demand and production capabilities. Volkswagen sold 3.7 million vehicles in China last year.
The investment is part of a Volkswagen investment of €22 billion (roughly $3.5 billion Canadian) planned by 2019, representing the largest investment program in the Chinese auto industry to date.