Volkswagen Group China (VGC; 大众汽车(中国)) is a division of the

German German(s) may refer to: * Germany (of or related to) **Germania (historical use) * Germans, citizens of Germany, people of German ancestry, or native speakers of the German language ** For citizens of Germany, see also German nationality law **Ge ...

automotive concern

Volkswagen Group Volkswagen AG (), known internationally as the Volkswagen Group, is a German multinational automotive manufacturer headquartered in Wolfsburg, Lower Saxony, Germany. The company designs, manufactures and distributes passenger and commercia ...

in the

People's Republic of China China, officially the People's Republic of China (PRC), is a country in East Asia. It is the world's List of countries and dependencies by population, most populous country, with a Population of China, population exceeding 1.4 billion, slig ...

. Volkswagen Group China enjoys sales of about 3.14 million cars (2017) in the Chinese market and is the largest brand in China by sales. The Chinese market is Volkswagen's largest market, accounting for around 50% of Volkswagen's global sales in 2021. Operations of Volkswagen in China include the production, sales and services of whole cars, parts and components, engines and transmission systems, and the sales and service of imported cars. The company's locally manufactured and imported vehicles are sold under various brand names such as

Volkswagen Volkswagen (),English: , . abbreviated as VW (), is a German Automotive industry, motor vehicle manufacturer headquartered in Wolfsburg, Lower Saxony, Germany. Founded in 1937 by the German Labour Front under the Nazi Party and revived into a ...

Audi Audi AG () is a German automotive manufacturer of luxury vehicles headquartered in Ingolstadt, Bavaria, Germany. As a subsidiary of its parent company, the Volkswagen Group, Audi produces vehicles in nine production facilities worldwide. ...

, Škoda,

Bentley Bentley Motors Limited is a British designer, manufacturer and marketer of luxury cars and SUVs. Headquartered in Crewe, England, the company was founded as Bentley Motors Limited by W. O. Bentley (1888–1971) in 1919 in Cricklewood, Nort ...

, and

Lamborghini Automobili Lamborghini S.p.A. () is an Italian brand and manufacturer of luxury sports cars and SUVs based in Sant'Agata Bolognese. The company is owned by the Volkswagen Group through its subsidiary Audi. Ferruccio Lamborghini (1916–19 ...

in China. Volkswagen Group China is the largest, earliest, and the most successful international partner in China's automotive industry. It started its connection with China as early as in 1978, and has been taking the leading position in the Chinese automotive market for more than 25 years. Its first

joint venture A joint venture (JV) is a business entity created by two or more parties, generally characterized by shared ownership, shared returns and risks, and shared governance. Companies typically pursue joint ventures for one of four reasons: to acces ...

in China, Shanghai Volkswagen Automotive Co., Ltd., was established in October 1984. This joint venture, now called

SAIC Volkswagen SAIC Volkswagen Automotive Co., Ltd., formerly known as Shanghai Volkswagen Automotive Co., Ltd. is an automobile manufacturing company headquartered in Anting, Shanghai, China and a joint venture between Volkswagen Group and SAIC Motor. It was ...

. was in the process of building an electric-car plant in Anting, near Shanghai by late 2018; it was expected to make 300,000 e-vehicles per year, starting in 2020. The second joint venture, FAW-Volkswagen Automotive Company Ltd. was established in

Changchun Changchun (, ; ), also romanized as Ch'angch'un, is the capital and largest city of Jilin Province, People's Republic of China. Lying in the center of the Songliao Plain, Changchun is administered as a , comprising 7 districts, 1 county and 3 ...

in February 1991. It manufactures VW and Audi brand cars. In 2018, an executive with FAW-Volkswagen's Audi division said that two million China-made Audi cars will be sold in the country by 2020. As of the end of 2017, the total to date was 777,000.

History

In 1984, Volkswagen signed a 25-year contract to make passenger cars in Shanghai. Since, at that time, vehicle manufacturers could not own a majority stake in a manufacturing plant, Volkswagen's venture took the limit of 50 per cent foreign ownership. Today, the Group has 16 representative companies in the country, undertaking parts delivery and service provision for both customers and industry in addition to vehicle production and import. By May 2004, Volkswagen Group had concentrated its strengths in the founding of Volkswagen Group China (VGC), which is governed by a six-member management team responsible for the areas of sales and marketing, technology, purchasing, personnel and governmental relations as well as finance. VGC's tasks include supervision of the Chinese associated companies of the Volkswagen Group, and the set-up of new business segments.

Operations

, via its Volkswagen Group China division, has 16

subsidiaries A subsidiary, subsidiary company or daughter company is a company owned or controlled by another company, which is called the parent company or holding company. Two or more subsidiaries that either belong to the same parent company or having a sa ...

China China, officially the People's Republic of China (PRC), is a country in East Asia. It is the world's List of countries and dependencies by population, most populous country, with a Population of China, population exceeding 1.4 billion, slig ...

, with

Shanghai Automotive Industry Corporation SAIC Motor Corp., Ltd. (formerly Shanghai Automotive Industry Corporation) is a Chinese state-owned automobile manufacturer headquartered in Anting, Shanghai. Founded in 1955, it is currently the largest of the " Big Four" state-owned car man ...

(SAIC), and

First Automobile Works China FAW Group Corp., Ltd. (First Automobile Works) is a Chinese state-owned automobile manufacturer headquartered in Changchun, Jilin.

(FAW) being the two major Chinese partner companies.

SAIC-Volkswagen

In 1984, a

(JV) was established between

and

(now SAIC Motor), creating Shanghai Volkswagen Automotive Co., Ltd. (SVW),

headquartered Headquarters (commonly referred to as HQ) denotes the location where most, if not all, of the important functions of an organization are coordinated. In the United States, the corporate headquarters represents the entity at the center or the top ...

Anting Anting () is a town in Jiading District, Shanghai, bordering Kunshan, Jiangsu to the west. It has 96,000 inhabitants and, after the July 2009 merger of Huangdu (), an area of .

Shanghai Shanghai (; , , Standard Chinese, Standard Mandarin pronunciation: ) is one of the four Direct-administered municipalities of China, direct-administered municipalities of the China, People's Republic of China (PRC). The city is located on the ...

. Equity holdings are split (as of 2010) - Volkswagen AG (40%), Volkswagen (China) Invest (10%), SAIC (50%). This a fixed term venture, of 45 years, running until 2030. Shanghai Volkswagen Automotive Co., Ltd. (SVW) is the first car-making joint venture since China began its reform, and debut to the outside world, and is located in Anting International Auto City on the northwest outskirts of

. Producing cars under the Volkswagen and the Škoda brands, SVW currently offers a total of twelve model series. By October 2009, SVW had turned out over five million cars in total, becoming the carmaker that has the biggest population of cars in China.

SAIC-Volkswagen and Škoda

In April 2005, Škoda officially landed at Shanghai Volkswagen, ushering Shanghai Volkswagen into the dual brand era. In September 2006, Shanghai Volkswagen Škoda – the first Chinese manufactured Škoda - was launched and the Chinese name was announced. Octavia, the first Shanghai Volkswagen Škoda model, hit the market on 6 June 2007. Following Octavia's success, Shanghai Volkswagen launched Fabia in 2008 and Superb in 2009.

SAIC-Volkswagen and Audi

In 2021, SAIC-Volkswagen launched the production of Audi branded cars, with the first being the Audi A7L. It has plans to sell 250,000 to 300,000 units per year by 2025 after the launch of other models. According to SAIC Audi marketing division, Audi cars that SAIC-Volkswagen intend to launch are all superior to the existing Audi models of FAW-Volkswagen.

FAW-Volkswagen

Established in February 1991, FAW-Volkswagen Automotive Company (FAW-VW) is a joint venture by FAW Group's

First Automobile Works China FAW Group Corp., Ltd. (First Automobile Works) is a Chinese state-owned automobile manufacturer headquartered in Changchun, Jilin.

Volkswagen AG Volkswagen AG (), known internationally as the Volkswagen Group, is a German multinational automotive manufacturer headquartered in Wolfsburg, Lower Saxony, Germany. The company designs, manufactures and distributes passenger and commercial ...

Audi AG Audi AG () is a German automotive manufacturer of luxury vehicles headquartered in Ingolstadt, Bavaria, Germany. As a subsidiary of its parent company, the Volkswagen Group, Audi produces vehicles in nine production facilities worldwide. The o ...

and Volkswagen (China) Investment Co., Ltd headquartered in

, Jilin. It was the first modern car industrial base constructed with an

economy of scale In microeconomics, economies of scale are the cost advantages that enterprises obtain due to their scale of operation, and are typically measured by the amount of output produced per unit of time. A decrease in cost per unit of output enables a ...

in China. With its development over the years, FAW-Volkswagen is producing thousands of vehicles on a daily basis. FAW-Volkswagen manufactures 10 products of two globally known brands, Volkswagen Passenger Cars and Audi, with advanced technology and equipment. Volkswagen Jetta, New Bora, Golf, Sagitar, Magotan, Volkswagen CC, Audi A6L, Audi A4L, Audi Q3 and Audi Q5 cars are very popular among consumers. FAW-Volkswagen is a mature production base in China, with a complete portfolio of both A-, B- and C-grade cars.

FAW-Volkswagen and Audi

, with more than 20 years of development experience in China, was the first global premium car brand to realize domestic production in China. Agreements on the manufacturing of the Audi 100 under license were signed on 13 August 1988, with this date marking the conclusion of negotiations lasting one year. The joint venture agreement included both the technology transfer for the production and planning of the

Audi 100 The Audi 100 and Audi 200 (and sometimes called Audi 5000 in North America) are primarily mid-size/executive cars manufactured and marketed by the Audi division of the Volkswagen Group. The car was made from 1968 to 1997 across four generations (C ...

, and the setting up of after sales support. Expertise was in addition transferred by providing training for some 500 Chinese workers at Audi in Germany. Furthermore, around 30 Audi employees were posted to

to provide production support. In November 1993, the then-Board Chairman of FAW and Volkswagen AG, signed a letter of intent on the integration of Audi production and a

V6 engine A V6 engine is a six-cylinder piston engine where the cylinders share a common crankshaft and are arranged in a V configuration. The first V6 engines were designed and produced independently by Marmon Motor Car Company, Deutz Gasmotoren Fabr ...

plant into the FAW-Volkswagen joint venture, which had been established at the end of 1991. As a result of the signing of the agreements in December 1995, Audi acquired a 10 percent stake in the joint venture by the name of FAW-Volkswagen Automotive Company Ltd. Volkswagen AG controls 30 percent, with FAW continuing to hold a 60 percent stake. The first Audi product built by the joint venture, a modified Audi 100 with V6 engine bearing the model designation Audi 200, went into production in May 1996. The Audi 200 remained in production until summer 1999 (facelift of the Audi 100) with 2.6 and 2.4

litre The litre (international spelling) or liter (American English spelling) (SI symbols L and l, other symbol used: ℓ) is a metric unit of volume. It is equal to 1 cubic decimetre (dm3), 1000 cubic centimetres (cm3) or 0.001 cubic metre (m3 ...

V6 engines and the 4-cylinder, 1.8 litre turbo power unit. The content manufactured locally at the Changchun plant was 60 percent.

Volkswagen Anhui

Volkswagen Anhui (formerly JAC-Volkswagen) is a joint venture formed in 2017 between

JAC Motors JAC Motors (; officially Anhui Jianghuai Automobile Co., Ltd.) is a Chinese automobile and commercial vehicle manufacturer.

and Volkswagen headquartered in

Hefei Hefei (; ) is the capital and largest city of Anhui Province, People's Republic of China. A prefecture-level city, it is the political, economic, and cultural center of Anhui. Its population was 9,369,881 as of the 2020 census and its built-up ( ...

, Anhui, initially to produce electric vehicles under the

SEAT A seat is a place to sit. The term may encompass additional features, such as back, armrest, head restraint but also headquarters in a wider sense. Types of seat The following are examples of different kinds of seat: * Armchair, a chair ...

brand, and later the Sehol brand. It was renamed to Volkswagen Anhui after Volkswagen took a majority stake (75%) in the company in 2020 along with a 50% stake in government-owned JAG (parent of JAC) in a one billion euro deal. The company will focus on electric vehicles, with an eMobility R&D hub that will serve the entire Volkswagen Group in China. Volkswagen is building a new factory for

Volkswagen MEB platform The Volkswagen Group MEB platform (german: Modularer E-Antriebs-Baukasten; English: ''modular electric-drive toolkit'') is a modular car platform for electric cars developed by the Volkswagen Group and its subsidiaries.Julian RendellSkoda electri ...

electric vehicles with a capacity of 350,000 a year under the company, alongside a battery systems factory under wholly-owned VW Anhui Components Company.

Further VGC entities

The following are the subsidiary companies which form Volkswagen Group China: