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Volkswagen select China’s Anhui province to be global hub for competence and e-mobility

Anhui province is to be transformed into a new technology centre and e-mobility hub for the VW Group in China. The new R&D centre was inaugurated on December 8th at the company’s facilities in Hefei. The joint venture JAC Volkswagen has also be renamed as Volkswagen (Anhui) Automotive Company Limited especially as VW holds a 75 percent stake in the joint venture, meaning the company will also take over the management control at Volkswagen (Anhui). All future products will be based on the Group’s Modular Electric Drive Matrix (MEB), there are plans for a step-by-step expansion of local R&D competence especially in the localization of MEB-based derivatives, and the aim of capitalizing on global synergies. It’s expected that by 2023 the first vehicle will roll off the Anhui production line.

“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.”

In Hefei, research and development, quality assurance, simultaneous engineering and full capability pre-series manufacturing and testing will all be united in one facility. VW hopes that by combining these key functions and using the MEB platform, Volkswagen will speed up the development cycles therefore allowing a significantly faster time-to-market for new products.

From now till 2025 Volkswagen (Anhui) is looking to increase its local talent pool, the majority being in R&D, the final number will be around 500 employees. 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.

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. The investment also includes the acquisition of 50 percent of JAG, the parent company of Volkswagen’s joint venture partner JAC. The joint venture will be fully consolidated in the Group’s operating results. Anhui, and its provincial capital of Hefei, have become rising new hubs for technology and innovation. Volkswagen recently acquired a strategic stake in Hefei-based battery supplier Gotion. Volkswagen will begin talks to establish a supplier park near to the factory in Hefei. And in addition to an e-mobility hub, Volkswagen aims to establish a digital hub in Anhui to support future connectivity and digital services across the Group’s portfolio.

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