Following the news that Volkswagen (VW) has inaugurated a research and development (R&D) center for e-mobility in the Anhui province of China;

Bakar Sadik Agwan, Senior Automotive Consulting Analyst at GlobalData, a leading data and analytics company, offers his view:

“The R&D center in the Anhui province will act as the next e-mobility hub for the company. The development follows VW’s announcement of bringing its ID.3 and ID.4 vehicles to China and the recent increase of stake in the JAC-VW joint venture to 75% from 50%. China, which accounts for the highest volume sales for VW, has always been at the epicenter of the company’s business strategy. The development will support VW’s strategy to increase its share of electric models in the country to 35% and deliver 1.5 million EVs by 2025.

“The R&D center will be followed by a manufacturing facility to roll out electric vehicles based on the company’s modular electric drive matrix (MEB) platform. The production of vehicles is expected to commence in 2023. VW will leverage its global synergies, existing capabilities in the country and the available adequate supply of parts and components to strengthen its e-mobility products and solutions. The move to establish the R&D center will also help the company to achieve net carbon neutrality by 2050 in the country.

“Volkswagen, which is already the market leader in China in terms of sales is all set to grab the opportunities in the high growth electric vehicle market. The country is the first automotive market to recover from the COVID-19 slump and the appetite for new vehicles, including the electric models, has been growing, thanks to the conducive government policies and strong charging infrastructure. The company now needs to focus on bringing in right positioned electric vehicle products to continue its legacy in China.”