One of the most shocking news for Volkswagen fans out there. As Europe’s largest automaker is on the edge of another crisis. The reason is VW is losing its market share in its most essential market which is China. This is because the players like Tesla and other EV makers in the region keep on expanding. While Chinese automakers are now routing toward VW’s home market, Europe.
Ahead of this year, Thomas Shafer, CEO of Volkswagen Passenger Cars, was mentioned by German publication Manager Magazin, saying, “The roof structure is on fire. This is the final wake-up call.” The statement was made at a management meeting. And came out majorly due to the automaker losing market share in the Chinese market. China market is considered to be an important market for VW. At the same time, the German automaker leading the market for years. This potentially generates almost half its earnings.
Although, the times have started to change now, and Volkswagen is lagging. The primary reason is the automaker’s transition to EVs in China, as the same results the VW flat-footed. During the pandemic phase, EV makers in the region, such as BYD, NIO, XPeng, and others, have expanded themselves toward electrified options. While many of them are offered cheaper than VW models.
As per the Automotive News, post sending a top executive to China in order to figure out the competition. Also, the message relayed back to CEO Oliver Blume was exposed.
Volkswagen fight as China’s EV makers expand
In addition to the above info, the executive told his new boss that Volkswagen has started losing the EV race in one of its important markets. While the hopes of catching don’t seem to be optimal.
Instead of Audi’s having the “Vorsprung durch Technik” or benefit from the technology. Apparently, Tesla and other EV makers from China have adopted the go-to for new features and tech. And now VW facing another bigger problem further. Since these EV pioneers in China are heading for Europe.
The transition was evident at this year’s IAA Mobility in Munich, with China’s EV presence doubling compared to 2021. China’s EV leaders like BYD and SAIC’s MG showed off impressive models aimed at the EU market, like the BYD SEAL electric sedan with up to 570 km (354 mi) range starting at 45,000 euros (about $48,000).
VW is also trying to step up the right move, this comprises to involves revamping its software unit and associating with outside partners as well. The company invested $700 million into Chinese EV maker XPeng for an approx 5% stake. This is to develop new models and reverse its outgrowth in the region.
