Analysis: How China is fuelling Volkswagen's electric dream

The rapid expansion of Volkswagen’s new electric ID range will ramp up in 2020 with the launch of two SUV-based models – both of which will be offered exclusively in China. 

The country will play a key role in VW’s ambitious goal to sell one million ID-branded electric cars per year by 2023. Stephan Wöllenstein, VW’s China boss, said the country is “the driving force” behind the firm’s electric offensive, which began with the launch of the ID 3 hatch at the recent Frankfurt motor show. In fact, the success of VW’s heavy investment in full-electric technology is likely to depend on the country – and China poses several major challenges. 

About half of VW’s 6.2 million car sales were in China. With Chinese government incentives heavily pushing electric vehicles, it is also the world’s largest electric car market, with 1.2m EVs sold there last year. 

VW wants to produce 22m electrified cars by 2028, with more than half of those in China. This will involve electrified versions of existing VW models, followed by a range of ID models based on the VW Group’s electric MEB platform. 

As with VW’s current range, ID models in China will be offered through the firm’s Beijing-based import business and its three joint ventures: the long-established FAW-Volkswagen and SAIC-Volkswagen, and the new JAC-Volkswagen. 

All three are building plants purely to make MEB-platformed cars, with the FAW and SAIC factories due to open next year, each with capacity for 300,000 cars annually. 

“That is not everything we will do capacity-wise, but it will allow us to serve the market as it is growing towards really big numbers,” said Wöllenstein. 

FAW-VW and SAIC-VW will each launch its own ID model next year, likely similar-sized cars with different external styling, as VW has done with its recent SUV range.