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In the Fight to Beat Tesla, China is VW’s Ace in the Hole

That Volkswagen has high electrical ambitions is now old news. The company has long maintained that it plans to sell more than 1 million electric vehicles annually by 2025 and be the world’s biggest maker of electric automobiles. But Tesla has a big head start, so VW will need an ace in the hole. feels that China is the key to its success.

Volkswagen feels that China is the key to realizing its ambitions. The vast market is already wildly important to VW because as the market leader there, selling nearly 4  million vehicles there in 2016. That total rivals the brand’s sales across the entire European continent and it a big reason the brand has been able to weather the TDI storm.

With the Chinese government subsidizing what it calls New Energy Vehicles, the market is expected to become the world leader for electric cars.

“China will be the leading market for electromobility in the coming years, so we will likely follow with local production roughly half to three-quarters of a year later (following Germany),” said brand boss Herbert Diess, at the brand’s Annual Session last week.

With that market and its already established local partnerships, VW will be able to set up the economy of scale that it says will allow it to offer EVs at affordable prices.

“We will enter with models that are below even 30,000 euros or dollars, as well as some that certainly are positioned far higher, and clearly want to be market leader,” he said.

That will allow VW to undercut Tesla, whose Model 3 will start at $35,000.

“That’s why we are very confident that we can stop Tesla’s expansion in the volume market since we are significantly better positioned and have a considerably higher capacity to achieve scale effects,” said Diess.

The post In the Fight to Beat Tesla, China is VW’s Ace in the Hole appeared first on VWVortex.



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