Car manufacturer: Market under pressure – Volkswagen changes China strategy

Volkswagen wants to increasingly use China as an export location. This also has to do with market developments in the People's Republic. The people of Wolfsburg are primarily looking at the southern hemisphere.

Volkswagen: The car manufacturer wants to export more from China. Photo: Katharina Kausche/dpa

Hefei. In view of the weakness of the Chinese car market and more competition from the People's Republic abroad, the Volkswagen Group is changing its China strategy. Instead of the previous motto “In China, for China”, the Wolfsburg-based company is now targeting markets outside the People’s Republic with “In China, Beyond China”, as the company announced in Hefei, eastern China.

In the future, Volkswagen wants to serve more markets in Southeast Asia, Southern Africa and South America with its joint ventures in China. In April, the group hinted at possible plans at the auto show in China. Volkswagen is already exporting cars from China to the Middle East or to Kazakhstan and Uzbekistan, it said.

In addition to the high competition and price pressure from Chinese brands, the weak car market in China is now also causing problems. Latest data from the Chinese Passenger Car Association (CPCA) for the overall market shows a 21.7 percent decline in sales figures for the first nine months of this year.

Business in China is also difficult for Volkswagen: In the third quarter, sales fell by 38.5 percent to 405,800 cars. The decline there accounted for more than 80 percent of the overall decline.

With the change in strategy, Volkswagen not only wants to defy Chinese competition in other markets, but also serve new countries. “China is exporting competitive pressure,” said corporate circles. This would be difficult with products from Europe, which is why VW wants to export from China.