Western car companies are collectively going electric, but Volkswagen is dismissive: If they spend another 5.5 billion, they will recognize the Chinese market

The global new energy vehicle market is changing rapidly. At this time last year, traditional automakers were still competing to see whose electrification plan was more radical; a year later, public opinion that "Western countries are giving up electrification" has become overwhelming, and manufacturers such as Mercedes-Benz, BMW, Cadillac, and Ford have all "turned around" and turned back to tinkering with fuel engines.

However, Volkswagen seems to be an exception. On May 13, Volkswagen (Anhui) Co., Ltd. underwent industrial and commercial changes, with its registered capital increasing from 7.356 billion yuan to 13.856 billion yuan, an increase of 88.4%. Volkswagen holds a 75% stake, with a capital contribution of 5.52 billion yuan.

Volkswagen has recognized the Chinese market.

There is a saying in the automotive industry: Toyota is the world, Volkswagen is China. This means that Toyota pays more attention to the global market, while Volkswagen is deeply tied to the Chinese market. At its peak, the Chinese market contributed 40% of Volkswagen's sales, and "Volkswagen of China" is not an empty statement.

In fact, Volkswagen's new energy sales in the Chinese market are not very good. In April 2024, the cumulative sales of the ID. series electric vehicles of Volkswagen South and North combined were only 13,000 units, which is about the same as an ordinary new car-making force in China, but this does not affect Volkswagen's investment enthusiasm.

Volkswagen Anhui, which increased its capital this time, was only established in 2017. Volkswagen increased its capital for the first time in 2020, and the capital increase in the past two days is the second time. In fact, Volkswagen Anhui has not launched a new car so far, but in Volkswagen's plan, it is a "middle Volkswagen" on par with the southern and northern Volkswagens, focusing on new energy vehicles.

Volkswagen is spending money like crazy in the Chinese market, mainly to promote its own new energy transformation. Data shows that from January to April, the cumulative sales of FAW-Volkswagen and SAIC Volkswagen were only 850,000 vehicles, less than the sales of BYD alone. For electric vehicles, Volkswagen seems to have placed all its bets on the Chinese market.

In addition to participating in the battle itself, Volkswagen has also cooperated with local Chinese manufacturers. In July 2023, Volkswagen purchased approximately 4.99% of Xpeng Motors' shares for US$700 million.

These collaborations are all focused on new energy vehicles, and Volkswagen's enthusiasm for this track for the present and the future is no less than that of domestic manufacturers. At a time when Toyota, Ford, and Mercedes-Benz are re-examining electric vehicles, Volkswagen is rushing forward in the Chinese new energy market.

Volkswagen's fondness for the Chinese market is full of historical roots.

In the era of fuel vehicles, few multinational manufacturers were not optimistic about the Chinese market. But in the era of new energy vehicles, Volkswagen still attaches great importance to the Chinese market, which requires a special courage.

Volkswagen's logic is actually very simple. Electric vehicles are the future. China accounts for 60% of the global new energy market share, and China has the most complete electric vehicle industry chain in the world. The penetration rate of new energy vehicles is also gradually increasing. In April, it has exceeded the critical point of 50%. Unless traditional manufacturers do not want to engage in electric vehicles at all, they must take root in the Chinese market.

With supply chains, market demand, partners, and strong industrial policy support, the Chinese market is almost the natural choice for major manufacturers to develop new energy vehicles. You should know that other markets outside the Chinese market only account for more than 30% of the market share. Instead of competing in the red ocean in the global market, it is better to fight hard in the Chinese market.

In addition to its enthusiasm for the Chinese market, another reason why Volkswagen insists on developing electrification in China is that it does have a certain foundation and is worth a try.

Unlike Toyota, Ford, Honda and other manufacturers, Volkswagen has already completed a complete industrial chain layout in China. FAW-Volkswagen and SAIC Volkswagen have a total of 6 ID. series models, and new models are constantly being launched. Although sales have not met expectations, it has at least built a team. You have to build a stage before you can perform.

Compared with Volkswagen's huge size and investment amount, the sales volume of the ID. series models can be said to be insignificant. It has been wielding its sword in the Chinese market for several years, but its sales volume is only that of a new car-making force. This is indeed a bit embarrassing.

But Volkswagen's new energy transformation is not without chance. In April 2024, the monthly sales of Volkswagen ID.3 exceeded 6,000 units, and the monthly sales of Volkswagen ID.4 CROZZ also exceeded 3,700 units, both of which have squeezed into the mainstream market. With Volkswagen's continued investment, more models in the ID. series will achieve breakthroughs. This may take a long time, but Volkswagen can wait.

From the perspective of the three-electric technology, there is no problem with Volkswagen's electric vehicles; it just performs averagely in terms of smart cockpit and smart driving, and lacks technical accumulation, but it can be compensated through cooperation and independent research and development. Volkswagen's research and development capabilities are still relatively strong, but it is difficult to turn around, and it takes a little time.

In fact, there is nothing special about Volkswagen's transformation path. Traditional automakers that want to transform basically follow this model. But Volkswagen's courage to persist is valuable. It still dominates the fuel vehicle market and can provide sufficient support for transformation. At the same time, its weight in the core technology field is also constantly increasing. Now Volkswagen just needs a real hit model.

We can recall that three years ago, BYD also relied on the BYD Han to achieve successful transformation; Volkswagen has invested so much money in the Chinese market, perhaps the expected blockbuster model is already on the way.

From the current perspective, Volkswagen will continue its transformation in the Chinese market unswervingly. No matter what, it must first enter the mainstream Chinese market before it can achieve transformation.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.