Can turning to electrification and expanding the layout of SUV become a "good medicine" for Volkswagen in China?-Shanghai Metals Market

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Can turning to electrification and expanding the layout of SUV become a "good medicine" for Volkswagen in China?

Translation 10:46:54AM May 24, 2019 Source:World car-Feng cool
The content below was translated by Tencent automatically for reference.

SMM News: although 2019 has only been 4 months, but the downturn and powerlessness of the car market has cast a shadow over every link in the automobile industry chain. Among the top carmakers, those as strong as Volkswagen, whose global sales fell 6.6 per cent in April from a year earlier, were overreliant on the Chinese market and the downturn in the global car market.

Of course, Volkswagen is still a "champion" in the Chinese market, but the monthly decline in sales so far this year may have to plunge its management into anxiety. So, on the eve of the Shanghai auto show, Volkswagen Group management, such as Dr. Dees, chairman of the management board of Volkswagen Group, and Dr. Feng Sihan, CEO of Volkswagen Group (China), flew to Shanghai to announce their latest development strategy to the media and the public. Express Volkswagen's importance to the Chinese market.

Radical electrification Development Strategy

As far as the development of the automobile industry is concerned, at present, the downturn of the global car market and the rapid growth of new energy vehicles seem to be a pair of contradictions, but in fact, it indicates that the change of the automobile industry in the world is accelerating. Under this trend, the head car companies are working out the development strategy of the transformation to the electrification field, among which Volkswagen is the most radical.

According to official data of Volkswagen Group, this year, Volkswagen Group will fully accelerate the electrification process, planning to release 14 new energy models; By 2028, Volkswagen plans to produce a total of 11.6 million pure electric vehicles in China, accounting for more than half of the group's global production target for pure electric vehicles. Volkswagen Group will work with FAW-Volkswagen, SAIC Volkswagen and Jianghuai Volkswagen to achieve this goal in China.

So what does this goal mean?

In terms of Volkswagen's current sales of new energy products in China, the Passat PHEV and Tuguan PHEV models sold just 13493 units in the first four months of this year. It can be said that at present, Volkswagen's sales of electrified models in China basically start from "zero", while in accordance with the expected production target of 2028, that is to say, over the next decade, Volkswagen will produce an average of 1.16 million pure electric models in China. For Volkswagen, which started almost from scratch in China, the goal must be ambitious.

In addition, from Volkswagen's capacity planning in the field of new energy, at present, SAIC Volkswagen Anting plant and FAW-Volkswagen Foshan plant, two MEB plants are under construction, is scheduled to be completed and put into production next year, with a total production capacity of 600000 vehicles per year; In 2020, Jianghuai Volkswagen Pure Electric passenger car Factory will also be put into production, with an annual production capacity of 100000 units. At present, Volkswagen's three joint ventures in China have a total capacity of 700000 units per year in the field of pure electric vehicles. In order to achieve the goal of producing 1160 pure electric vehicles by 2028, Volkswagen will further expand the production capacity of pure electric vehicles in China in the future. Data show that by 2025, Volkswagen's pure electric vehicle capacity in China will expand to 1.5 million units per year, accounting for 20% to 25% of the group's total capacity in China. In other words, in the future, Volkswagen's new production capacity in China will all be transferred to electric models.

From the perspective of new energy vehicle sales, at present, the production and sales of new energy vehicles have just passed the 1 million mark; the industry expects that in 2020, China's new energy vehicles will usher in the volume node, planned sales will reach 2 million, after which the industry will enter a period of rapid growth. According to the "New Energy vehicle Blue Book" released by Automobile House, the sales of new energy passenger vehicles in China will reach 11.04 million in 2028. From the perspective of Volkswagen's radical and ambitious goals in the field of electrification, its electrification development strategy in the Chinese market may contribute to the growth of production and marketing of new energy vehicles in China in the next decade.

In addition, Volkswagen in order to tie in with the future electric development model, or is committed to the integration of the layout of China's charging pile field. A few days ago, the media learned that Volkswagen (China) Investment Co., Ltd., together with China FAW and Wanbang de and the three parties, jointly funded the formation of Kaimai New Energy Technology Co., Ltd. The company is committed to the development, design, production and sales of charging wall boxes and charging piles for electric vehicles. At the same time, Volkswagen plans to invest 1 billion euros to build a power battery factory in Germany.

It can be seen that since 2015, after the "emission gate" scandal, Volkswagen Group has taken electrification as the strategic core of the next group. On the eve of this year's Shanghai auto show, Volkswagen reiterated and elaborated on its vision for electrification. Compared with the electrification strategy of other multinational auto companies, Volkswagen's electrification strategy in China is ambitious and radical. However, from the perspective of its layout and integration of the whole electric vehicle industry chain, its penetration in the motorized industrial chain may ensure the smooth landing of this grand goal.

As far as the current situation of the development of the domestic new energy market is concerned, at present, the support of the national fiscal policy for new energy vehicles is gradually weakening. By 2020, after all the state subsidies are abolished, the new energy vehicle market will be further tilted to the dominant direction of the market. At this time, foreign-funded enterprises rely on product and technological advantages, or will occupy a favorable position in the new round of market competition. From this point of view, in 2020, with the completion of two MEB plants and the production of Jianghuai Volkswagen pure electric passenger car factory, Volkswagen may enter the centralized explosion period of electrified models in China.

Can SUV be a "lucky star" to save the market?

In addition to continuously promoting the electrification process, Volkswagen also has a major strategic plan in China this year, that is, to expand the layout of SUV products.

At present, the overall decline of China's car market, resulting in various market segments show varying degrees of decline, followed by a sharp drop in the heat of the SUV market. According to data compiled by the Geshi Automotive Research Institute, in April, the domestic SUV market sold 663000 units, down 18 percent from the same period last year; from January to April this year, the cumulative sales volume of the SUV market was 2.934 million units, down 15.2 percent from the same period last year.

However, the continued contraction of the SUV market has not stopped Volkswagen from increasing its pace in this area. Also on the eve of this year's Shanghai Auto Show, Volkswagen held a special "SUV Night." At the event, in addition to releasing five new SUV models, Volkswagen also announced that it would increase the number of Volkswagen-branded SUV in China from six to 12 by 2020.

Volkswagen's continued increase in SUV has been ridiculed by the industry as "a new SUV product that was missing a few years ago, and now it has to make up for it."

From Volkswagen's joint venture partner in China, North and South Volkswagen in the sale of SUV sales, Tuguan and Tuyue monthly sales remained at more than 10,000 units, in April, both models are among the top 10 SUV sales. Although FAW-Volkswagen dabbled in the SUV field relatively late, but its first SUV product exploration song, now the monthly sales can also stabilize at about 8000 units, in the domestic equivalent models in the middle and upper reaches level.

In addition, Tanyue listed at the same time with Tuyue, although the market performance is not as good as the former, but in the more severe situation of the overall market, its monthly sales volume is maintained at an average of more than 7000 units, the performance is not bad.

However, in the medium and large SUV sector, Tuang monthly sales in the segment although still far ahead, but since the second half of last year, its monthly sales continued to decline; Prado, on the other hand, has seen a sharp rise in monthly sales so far this year. In contrast, in the high-end SUV field, where market share is gradually rising, Tuang's performance is not a positive signal.

Perhaps SAIC Volkswagen is aware of this "crisis" and plans to launch two new SUV, this year: the small SUV T cross, which went public in April, and the upcoming Tuang X. The launch of Tuang X may form a joint force with Tuang, which SAIC Volkswagen is selling, to expand more market share in the medium and large SUV field.

T Cross, Volkswagen's first small SUV product in China, is aimed at young consumers. The arrival of this model has expanded the market layout of Volkswagen's SUV products, but it remains to be seen how much the model can pry into the market in the shrinking small SUV sector.

To sum up, on the existing performance of Volkswagen domestic SUV models, in the case of the retreat of the SUV boom, the market performance of Volkswagen brand products is still good. This also confirms the myth that "domestic consumers are after SUV and are keen on the public". Even when the car market is in the doldrums, this "myth" may still have a factual basis.

In terms of the current share of SUV products in the entire passenger car system, it has retreated from about 50 per cent in the past to just over 40 per cent. The industry forecasts that SUV should account for no more than 45 per cent of passenger cars. According to this calculation, the future SUV market increment will be quite limited, so in this case, Volkswagen continues to increase the number of SUV, what do you want?

In fact, looking back at Volkswagen's current holdings in China, it is not difficult to understand this strategy. Today, North and South Volkswagen together sell 4 million units a year, a huge market volume that no one can compete with at home. As the domestic car market changes from the incremental market to the stock market, the focus of car companies is not just on young new customers, focus on existing customers, or will gain more room for improvement. And the middle and advanced SUV products are precisely one of the models with the greatest probability of upgrading and purchasing by users. Therefore, Volkswagen's expanded layout of SUV models may be aimed at seizing existing customers in the stock market. Open up a brand and product upward channel.

What's more, Volkswagen's SUV layout will be bundled with an electrification strategy to attack end consumers.

 

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Key Words:  Electric cars  new energy  Volkswagen 

Can turning to electrification and expanding the layout of SUV become a "good medicine" for Volkswagen in China?

Translation 10:46:54AM May 24, 2019 Source:World car-Feng cool
The content below was translated by Tencent automatically for reference.

SMM News: although 2019 has only been 4 months, but the downturn and powerlessness of the car market has cast a shadow over every link in the automobile industry chain. Among the top carmakers, those as strong as Volkswagen, whose global sales fell 6.6 per cent in April from a year earlier, were overreliant on the Chinese market and the downturn in the global car market.

Of course, Volkswagen is still a "champion" in the Chinese market, but the monthly decline in sales so far this year may have to plunge its management into anxiety. So, on the eve of the Shanghai auto show, Volkswagen Group management, such as Dr. Dees, chairman of the management board of Volkswagen Group, and Dr. Feng Sihan, CEO of Volkswagen Group (China), flew to Shanghai to announce their latest development strategy to the media and the public. Express Volkswagen's importance to the Chinese market.

Radical electrification Development Strategy

As far as the development of the automobile industry is concerned, at present, the downturn of the global car market and the rapid growth of new energy vehicles seem to be a pair of contradictions, but in fact, it indicates that the change of the automobile industry in the world is accelerating. Under this trend, the head car companies are working out the development strategy of the transformation to the electrification field, among which Volkswagen is the most radical.

According to official data of Volkswagen Group, this year, Volkswagen Group will fully accelerate the electrification process, planning to release 14 new energy models; By 2028, Volkswagen plans to produce a total of 11.6 million pure electric vehicles in China, accounting for more than half of the group's global production target for pure electric vehicles. Volkswagen Group will work with FAW-Volkswagen, SAIC Volkswagen and Jianghuai Volkswagen to achieve this goal in China.

So what does this goal mean?

In terms of Volkswagen's current sales of new energy products in China, the Passat PHEV and Tuguan PHEV models sold just 13493 units in the first four months of this year. It can be said that at present, Volkswagen's sales of electrified models in China basically start from "zero", while in accordance with the expected production target of 2028, that is to say, over the next decade, Volkswagen will produce an average of 1.16 million pure electric models in China. For Volkswagen, which started almost from scratch in China, the goal must be ambitious.

In addition, from Volkswagen's capacity planning in the field of new energy, at present, SAIC Volkswagen Anting plant and FAW-Volkswagen Foshan plant, two MEB plants are under construction, is scheduled to be completed and put into production next year, with a total production capacity of 600000 vehicles per year; In 2020, Jianghuai Volkswagen Pure Electric passenger car Factory will also be put into production, with an annual production capacity of 100000 units. At present, Volkswagen's three joint ventures in China have a total capacity of 700000 units per year in the field of pure electric vehicles. In order to achieve the goal of producing 1160 pure electric vehicles by 2028, Volkswagen will further expand the production capacity of pure electric vehicles in China in the future. Data show that by 2025, Volkswagen's pure electric vehicle capacity in China will expand to 1.5 million units per year, accounting for 20% to 25% of the group's total capacity in China. In other words, in the future, Volkswagen's new production capacity in China will all be transferred to electric models.

From the perspective of new energy vehicle sales, at present, the production and sales of new energy vehicles have just passed the 1 million mark; the industry expects that in 2020, China's new energy vehicles will usher in the volume node, planned sales will reach 2 million, after which the industry will enter a period of rapid growth. According to the "New Energy vehicle Blue Book" released by Automobile House, the sales of new energy passenger vehicles in China will reach 11.04 million in 2028. From the perspective of Volkswagen's radical and ambitious goals in the field of electrification, its electrification development strategy in the Chinese market may contribute to the growth of production and marketing of new energy vehicles in China in the next decade.

In addition, Volkswagen in order to tie in with the future electric development model, or is committed to the integration of the layout of China's charging pile field. A few days ago, the media learned that Volkswagen (China) Investment Co., Ltd., together with China FAW and Wanbang de and the three parties, jointly funded the formation of Kaimai New Energy Technology Co., Ltd. The company is committed to the development, design, production and sales of charging wall boxes and charging piles for electric vehicles. At the same time, Volkswagen plans to invest 1 billion euros to build a power battery factory in Germany.

It can be seen that since 2015, after the "emission gate" scandal, Volkswagen Group has taken electrification as the strategic core of the next group. On the eve of this year's Shanghai auto show, Volkswagen reiterated and elaborated on its vision for electrification. Compared with the electrification strategy of other multinational auto companies, Volkswagen's electrification strategy in China is ambitious and radical. However, from the perspective of its layout and integration of the whole electric vehicle industry chain, its penetration in the motorized industrial chain may ensure the smooth landing of this grand goal.

As far as the current situation of the development of the domestic new energy market is concerned, at present, the support of the national fiscal policy for new energy vehicles is gradually weakening. By 2020, after all the state subsidies are abolished, the new energy vehicle market will be further tilted to the dominant direction of the market. At this time, foreign-funded enterprises rely on product and technological advantages, or will occupy a favorable position in the new round of market competition. From this point of view, in 2020, with the completion of two MEB plants and the production of Jianghuai Volkswagen pure electric passenger car factory, Volkswagen may enter the centralized explosion period of electrified models in China.

Can SUV be a "lucky star" to save the market?

In addition to continuously promoting the electrification process, Volkswagen also has a major strategic plan in China this year, that is, to expand the layout of SUV products.

At present, the overall decline of China's car market, resulting in various market segments show varying degrees of decline, followed by a sharp drop in the heat of the SUV market. According to data compiled by the Geshi Automotive Research Institute, in April, the domestic SUV market sold 663000 units, down 18 percent from the same period last year; from January to April this year, the cumulative sales volume of the SUV market was 2.934 million units, down 15.2 percent from the same period last year.

However, the continued contraction of the SUV market has not stopped Volkswagen from increasing its pace in this area. Also on the eve of this year's Shanghai Auto Show, Volkswagen held a special "SUV Night." At the event, in addition to releasing five new SUV models, Volkswagen also announced that it would increase the number of Volkswagen-branded SUV in China from six to 12 by 2020.

Volkswagen's continued increase in SUV has been ridiculed by the industry as "a new SUV product that was missing a few years ago, and now it has to make up for it."

From Volkswagen's joint venture partner in China, North and South Volkswagen in the sale of SUV sales, Tuguan and Tuyue monthly sales remained at more than 10,000 units, in April, both models are among the top 10 SUV sales. Although FAW-Volkswagen dabbled in the SUV field relatively late, but its first SUV product exploration song, now the monthly sales can also stabilize at about 8000 units, in the domestic equivalent models in the middle and upper reaches level.

In addition, Tanyue listed at the same time with Tuyue, although the market performance is not as good as the former, but in the more severe situation of the overall market, its monthly sales volume is maintained at an average of more than 7000 units, the performance is not bad.

However, in the medium and large SUV sector, Tuang monthly sales in the segment although still far ahead, but since the second half of last year, its monthly sales continued to decline; Prado, on the other hand, has seen a sharp rise in monthly sales so far this year. In contrast, in the high-end SUV field, where market share is gradually rising, Tuang's performance is not a positive signal.

Perhaps SAIC Volkswagen is aware of this "crisis" and plans to launch two new SUV, this year: the small SUV T cross, which went public in April, and the upcoming Tuang X. The launch of Tuang X may form a joint force with Tuang, which SAIC Volkswagen is selling, to expand more market share in the medium and large SUV field.

T Cross, Volkswagen's first small SUV product in China, is aimed at young consumers. The arrival of this model has expanded the market layout of Volkswagen's SUV products, but it remains to be seen how much the model can pry into the market in the shrinking small SUV sector.

To sum up, on the existing performance of Volkswagen domestic SUV models, in the case of the retreat of the SUV boom, the market performance of Volkswagen brand products is still good. This also confirms the myth that "domestic consumers are after SUV and are keen on the public". Even when the car market is in the doldrums, this "myth" may still have a factual basis.

In terms of the current share of SUV products in the entire passenger car system, it has retreated from about 50 per cent in the past to just over 40 per cent. The industry forecasts that SUV should account for no more than 45 per cent of passenger cars. According to this calculation, the future SUV market increment will be quite limited, so in this case, Volkswagen continues to increase the number of SUV, what do you want?

In fact, looking back at Volkswagen's current holdings in China, it is not difficult to understand this strategy. Today, North and South Volkswagen together sell 4 million units a year, a huge market volume that no one can compete with at home. As the domestic car market changes from the incremental market to the stock market, the focus of car companies is not just on young new customers, focus on existing customers, or will gain more room for improvement. And the middle and advanced SUV products are precisely one of the models with the greatest probability of upgrading and purchasing by users. Therefore, Volkswagen's expanded layout of SUV models may be aimed at seizing existing customers in the stock market. Open up a brand and product upward channel.

What's more, Volkswagen's SUV layout will be bundled with an electrification strategy to attack end consumers.

 

"[investment must see] Trade friction news flying all over the metal how to win in chaos?

"Click to enter the registration page

Scan QR code and apply to join SMM metal exchange group, please indicate company + name + main business

 

Key Words:  Electric cars  new energy  Volkswagen