Volkswagen Group has confirmed the closure of one of its manufacturing plants in China, underscoring its accelerating shift towards electric mobility in the world’s largest automotive market.
A spokesperson for the German automaker said production had ceased at a facility in Nanjing, operated jointly with Chinese partner SAIC. The decision, initially reported by Handelsblatt, reflects both the declining demand for internal combustion engine vehicles and broader strategic objectives tied to electrification.
“Volkswagen Group and its joint venture partners are accelerating the transformation towards electric, intelligent, connected vehicles,” the spokesperson said. “Many SAIC Volkswagen sites are currently being converted or have already been converted for electric vehicle production.”
According to a company source, the Nanjing plant’s location within a dense urban setting complicated the retrofitting process for electric vehicle production and limited potential expansion opportunities.
Electric vehicle sales continue to gain traction across China, placing mounting pressure on traditional European manufacturers. Volkswagen, long dominant in the Chinese market with its petrol and diesel offerings, has seen its position challenged in recent years by agile local competitors such as BYD.
As part of its “In China, for China” initiative, Volkswagen is leaning more heavily on domestic expertise to realign its operations with local market demands. The company confirmed that its production network is undergoing optimisation in line with this renewed strategic focus.
Volkswagen also disclosed a 2.1% decline in vehicle deliveries in China for the first half of 2025. While the drop reflects ongoing competitive pressures, it marks an improvement over the 7.4% year-on-year fall reported during the same period in 2024.
-AFP
