VW says it won’t offer generous discounts on its vehicles in China to compete with local manufacturers, noting that it is currently focused on profitability rather than sales volume and market share.
During a recent interview with Reuters, VW chief executive Ralf Brandstaetter said the German brand wants to be the biggest international carmaker in China but is not concerned if it is out-sold by a local carmaker. Indeed, he said it is “irrelevant” if a Chinese brand sells more vehicles than it does.
“Volkswagen is focusing on a sustainable business model,” Brandstaetter said. “In concrete terms, this means that we will not participate in the discount battle at any price. Our market position is strong enough. For us, the focus is on profitability, not sales volume or market share.”
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The size of the Chinese car market is expected to grow considerably over the coming years and could hit 30 million annual sales by 2030, up from the current 22 million.
“If we achieve sales of more than 4 million vehicles in this environment in 2030, with corresponding profitability, that is a position we could very well live with,” Brandstaetter added.
The VW chief’s statements come shortly after it was revealed that BYD had outsold VW in the first quarter of this year, selling a total of 552,076 vehicles, all of which are considered as NEVs or ‘new energy vehicles’ in China. This represented a surge of 92.81% over the first quarter of 2022 and puts the brand on track to easily top the record 1.86 million vehicles that it sold in 2022, the vast majority of which were sold locally.
The German brand doesn’t just see itself continuing to sell a considerable number of vehicles in China over the coming years but will also start to export cars that it builds in China to overseas markets, including Europe.
