NEWS

Hefei, December 8, 2020. Hefei in Anhui province is to be transformed into a new e-mobility hub for the Volkswagen Group in China. Following Volkswagen’s increased stake in joint venture JAC Volkswagen, today saw the inauguration of a new R&D center at the company’s facilities in Hefei, with the joint venture being renamed as Volkswagen (Anhui) Automotive Company Limited (Volkswagen (Anhui)). This renaming underscores the completion of Volkswagen Group’s strategic investment in the joint venture with JAC. In the closing of this transaction, Volkswagen takes over management control at Volkswagen (Anhui) with a 75 percent stake. The company’s future products will be based on the Group’s Modular Electric Drive Matrix (MEB), with plans for a step-by-step expansion of local R&D competence in the localization of MEB-based derivatives, and the aim of capitalizing on global synergies. The first vehicle is expected to roll off the Anhui production line in 2023.

“Volkswagen Anhui is a promise for stronger partnership and e-mobility power in China. Within the next three years, we can expect state-of-the-art MEB production, a new full-electric portfolio and technology solutions from its R&D center in Anhui. This year’s investment of around one billion Euro accelerates the progress within the joint venture. Volkswagen Anhui will strengthen China’s role in the electrification and digitalization of the Volkswagen Group,” said Dr. Herbert Diess, CEO of Volkswagen AG.

“With our commitment to Volkswagen (Anhui), we will fully leverage the global synergies of the Group to intensify our e-mobility strategy in China and help us achieve net-carbon neutrality come 2050,” said Volkswagen Group China CEO Dr. Stephan Wöllenstein. “Through this new R&D center, we will strengthen the local expertise and production efficiency of Volkswagen (Anhui), which will play a key role in rapidly growing and optimizing our NEV portfolio to address the differing needs of Chinese customers in what is the world’s largest NEV market. At Volkswagen, we appreciate the further opening up of the country, which allows for us to accelerate our transformation towards e-mobility.”

The second phase of Volkswagen (Anhui)’s transformation will start in 2021, with the expansion of infrastructure and equipment for the production lines, plus the building of a battery workshop as well as a vehicle and component validation workshop. The full-scale factory for pure-electric vehicles, with a maximum production capacity of 350,000 units per annum, is due to be completed by the end of 2022, with the first model planned to go into series production in 2023.

Based on the MEB platform, Volkswagen (Anhui)’s products will build on Volkswagen’s DNA of quality, safety and lasting value. Targeting younger customers, the new product portfolio will have a fresh and distinctive design with a strong emotional appeal.

Volkswagen (Anhui) is now increasing local talent, the majority being in R&D, to number around 500 employees by 2025. Benefiting from Volkswagen Group’s global expertise, locally-hired staff will be sent to Group facilities across Europe – including the headquarters in Wolfsburg, Germany – to receive training in digitalization, whole-vehicle testing and certification, product management and electronics development. In addition, R&D experts from Germany will join Volkswagen (Anhui) during the ramp-up phase for further on-site training.

In Hefei, research and development, quality assurance, simultaneous engineering and full capability pre-series manufacturing and testing will all be united in one facility, with integration across the industrial value chain. By combining these key functions and using the MEB platform, Volkswagen will speed up development cycles and allow for significantly faster time-to-market for new products.

Volkswagen Group has invested around one billion Euros to increase its shareholding in Volkswagen (Anhui), formerly known as JAC Volkswagen, from 50 to 75 percent. Also included in the investment is the acquisition of  50 percent of JAG, the parent company of Volkswagen’s joint venture partner JAC.With the closing of this transaction, Volkswagen now takes over management control at Volkswagen (Anhui). The joint venture will be fully consolidated in the Group’s operating results.

Volkswagen to create a new e-mobility hub in Anhui

Anhui, and its provincial capital of Hefei, have become rising new hubs for technology and innovation, including e-mobility. Since the creation of the formerly known JAC Volkswagen joint venture back in 2017, Volkswagen has become a fixture in Anhui’s local ecosystem of NEV manufacturers and suppliers. Volkswagen aims to make Anhui a new e-mobility hub for the Group in China and recently acquired a strategic stake in Hefei-based battery supplier Gotion, to become its largest shareholder. To further maximize efficiency and strengthen its electrification strategy, Volkswagen is now starting talks with both domestic and international suppliers to establish a dedicated supplier park near to the factory in Hefei.

In addition to an e-mobility hub, Volkswagen also aims to establish a digital hub in Anhui, so as to support future connectivity and digital services across the Group’s NEV portfolio. With a strong focus on technology and innovation in Anhui, the province boasts a highly qualified and motivated local talent pool, including in the areas of software, digitalization, and other future-oriented technologies related to mobility. Volkswagen (Anhui) will draw on these advantages and is in the process of identifying suitable Hefei-based companies as potential partners to ensure a future that is fully connected to meet the demands of China’s consumers.

Volkswagen Anhui Front

Bird View of Volkswagen Anhui Location