Volkswagen (VW) is taking another step towards establishing a new local sub-brand for electric cars in China. According to German media, the new brand will incorporate the lines of the ID family, which Chinese customers have received with only moderate enthusiasm. The new Volkswagen China brand will convey more lifestyle and appeal to a younger audience, and the first model to launch in China will be the Cupra Tavascan, which VW showed a few days ago.
The Cupra Tavascan is the most powerful MEB model to date and the company’s first all-electric SUV coupé. The model’s infotainment touchscreen measures 15 inches diagonally, the largest so far in a Cupra model. The current MEB models must make do with ten- or twelve-inch screens. The Tavascan will reportedly be manufactured at Volkswagen Group’s Anhui plant in China, also for global markets. VW hopes to sell more than 70,000 vehicles per year.
See also: Cupra, Volkswagen’s subsidiary, will launch three electric vehicle models by 2025
Why Volkswagen is not launching Cupra in China mainly for practical reasons. Setting up a completely new brand there is far too costly. Besides, Volkswagen has had bad experiences with Škoda and the China start-up Jetta. Both are languishing below one per cent market share, and Škoda is likely to pull out of the country altogether soon. Instead, VW prefers launching a sub-label to the established Volkswagen brand.
The report does not say precisely what the new sub-brand will be called. However, how strongly the new label will or will not be perceived as VW by Chinese customers will likely be decisive. Nio and BYD are mentioned as role models, with BYD taking the top sales position in China from Wolfsburg in the first quarter.
Following the completion of the Anting (SAIC VW) and Foshan (FAW-VW) plants, Anhui is the group’s third production facility for pure electric vehicles in the country. Overall, Anhui appears to be taking on a more central role in Volkswagen’s latest “in China, for China” strategy. VW has acquired a 75% majority stake in the joint venture with JAC and renamed the company from JAC Volkswagen to Volkswagen Anhui. In the other two joint ventures, the Chinese partners still hold at least 50%.
See also: NIO’s Sub-Brand ALPS to Target Mainstream Market with New Sales Channel and Halved Model Range
Volkswagen expects the new R&D venture ‘100%TechCo’ to bring the German corporation closer to Chinese customers by integrating “state-of-the-art technologies from local suppliers,” among other things. The project, also called a “new company,” is to combine vehicle and component development and procurement when launching in 2024. Volkswagen expects it to play a significant role in developing a future Volkswagen brand model to launch in 2024.
