China automotive market will see strong rebound in 2H2023, VW CEO says

Peng Chen, DIGITIMES Asia, Taipei 0


Volkswagen Group CEO Oliver Blume is visiting China. He said the country's automotive market will make a robust comeback in the second half of this year. In addition, Blume also stated that Volkswagen will not be dragged into the EV price war started by Tesla.

The CEO went to China last week. He became the first chief executive of a global carmaker to visit the country after the strict COVID policy was lifted two months ago. Blume also joined a group of business leaders visiting China with German chancellor Olaf Scholz in early November.

According to multiple media reports, Blume plans to stay in the country for a week and go to the automaker's local joint venture in Shanghai, Changchun and Hefei. He will talk to consumers, partners and employees.

When asked about the 2023 outlook for China's automotive market on January 30, Blume said he expected the market to continue to grow. The country will see a strong rebound, especially in the second half of this year, according to China-based Yiche.

Tesla and other Chinese automakers have expanded aggressively in China. Blume said fierce competition can push a company to grow continuously. However, Volkswagen must first ensure its strategies and products can succeed locally. It has gained more and more insights into the market's needs.

According to Volkswagen, it delivered more than 3.18 million cars in mainland China and Hong Kong last year. New energy vehicle deliveries reached 206,500 cars, a 37.1% increase from 2021. Battery EV deliveries also grew 68.2%.

Global Times reported that Blume has learned that more than 50 testing sites in China conduct tests and verifications for autonomous driving. He said the technology has great potential in the country.

In October 2022, Volkswagen announced that Cariad, its software subsidiary, will establish a joint venture with China-based Horizon Robotics to develop advanced driver assistance systems (ADAS) and autonomous driving.

Blume said similar partnerships in China will become more and more critical. Since Volkswagen can't take care of every aspect of the work, especially for electrification and high technology, collaborating with partners will help the company localize in China.

On the other hand, in a recent interview with German-based Frankfurter Allgemeine Sonntagszeitung Blume made it clear that Volkswagen will stay out of the current price war joined by Tesla, Ford, VinFast and other automakers. General Motors also made a similar statement on Tuesday.

According to Automotive News, Blume told the German newspaper that Volkswagen has a clear pricing strategy and trusts the strength of its products and brands. He added that the company aims to become a global EV leader through profitable growth.