Volkswagen Boosts EV Production Capacity in China With 2.5 Billion Euros Investment

The Volkswagen Group is investing an extra 2.5 billion euros in its innovation hub in Hefei, Anhui Province, China, to boost its electric vehicle (EV) manufacturing capacity. In addition to the expansion of R&D facility, preparations are also being made for the production of two Volkswagen brand models, which are currently being developed together with Chinese partner XPENG.

Production of the first model, an SUV in the mid-size segment, will begin as early as 2026. 

The additional models accelerate the electrification of the Volkswagen Group's model portfolio in China.

By 2030, more than 30 all-electric models of all Group brands will be on offer in China alone.

Volkswagen China Technology Company (VCTC), VW’s 100% owned subsidiary based in Hefei, is the central unit responsible for product localisation.

VCTC is also developing the first China-specific electric architecture, the China Main Platform (CMP), on which at least four additional models for the electric entry-level segment in the compact class will be built from 2026.

VW's long-standing Chinese partners are SAIC and FAW,

Ralf Brandstätter, Member of the Board of Management of Volkswagen AG for China: “Today, around 50 million customers in China drive a Group product. The basis for our success is the cooperation with our strong Joint Venture partners, SAIC and FAW. Together, we are now accelerating the transformation towards smart electric mobility. With our ‘In China, for China’ strategy, we have a strong plan and are accelerating the realignment of our business, with more customer focus, more speed and more local development. Our new production and development hub in Hefei will bring technologies to market around 30 percent faster in the future. This additional investment in the site underlines our ambition to quickly expand our local innovative strength.”

Volkswagen Group has 39 plants in China.