The carmaker is aiming to slash development times of local models by over 30%
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by Brad Anderson
5 hours ago
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- The first model from VW and Xpeng will launch in 2026.
- There are currently more than 50 million VW Group vehicles on China’s roads.
- VW plans to offer more than 30 BEVs in the country by 2030.
The Volkswagen Group has announced a €2.5 billion ($2.68 billion) investment into its Chinese production and innovation hub in Hefei, confirming the development of two models in collaboration with Chinese EV maker Xpeng.
The German carmaker formed a joint venture partnership with JAC to accelerate its electrification plans in China in 2017. Its current Hefei site in the Anhui Province serves as the production, development, and procurement center and will soon be expanded into a strategic innovation hub for the local market. The VW Group plans to offer more than 30 all-electric models across China by 2030.
Read: VW And XPeng Partner On 2026 Electric SUV For China
VW says that the new “In China, for China” strategy will help them adopt a higher degree of localization and bring “state-of-the-art local technologies into its models at ‘China Speed’.” Development times of local models will be reduced by more than 30% and products will be designed with the specific requirements of Chinese customers in mind.
“Today, around 50 million customers in China drive a Group product,” member of the board of management of Volkswagen AG for China, Ralf Brandstätter, said. “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,” he continued. “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.”
The first product from VW’s partnership with Xpeng will arrive in 2026 and will be an electric mid-size SUV based on the Xpeng G9 and featuring an 800-volt architecture.
