To relaunch, Volkswagen will create a “small” brand.

To relaunch, Volkswagen will create a “small” brand.

Last year, Volkswagen and its historic Chinese partner SAIC (unfortunately the owner of the MG brand) reached a milestone. VW has become the first car brand, with the help of its partner, to exceed 22 million cars manufactured since the arrival of the Germans on Chinese soil, in the late 1970s. Links with SAIC were closed. 1984. Volkswagen therefore has great legitimacy in China, a market that the Wolfsburg legend knows well.. It is too good not to know that the Chinese have benefited all these years, through partnerships, from technology transfers that today allow them to be competitive. So much so that it now covers Western products, including in the top categories. And in order not to lose its focus in the world’s largest car market, Volkswagen must find new solutions.

The new “sub-brand” at VW

Sales of the VW brand in China collapsed at the start of the year. Only the ID.3 will be able to keep up with that speed.©Volkswagen

Last year, the VW group sold 3.18 million vehicles in China, including 206,000 so-called “new energy” vehicles.. Under this surname hide electricity, but also rechargeable hybrids. Volkswagen’s risk is therefore to be left behind in the sale of electric cars by Chinese brands, which flood their own market.

The group boss’s visit to China earlier in the year therefore had nothing to do with bad luck. Behind this trip mixed with meetings with the leaders of China’s allies, there were certainly important strategic decisions hidden. Among them, the creation of a completely new vehicle within the Volkswagen brand itself.

His name has not yet been released, but a senior company official confirmed Automobilwoche that the Cupra Tavascan, produced in China, will not be sold in this country by Cupra: “in China, it will go under a different brand“.

In China, Volkswagen is particularly suffering from competition from brands like BYD and Nio that can attract new, young, and enjoy electric mobility. In the first quarter, BYD sold more cars than VW Group. The first in the history of this market, as there has never been a Chinese manufacturer to take the top position. To make matters worse, sales of VW brand electric products fell 34% in the first quarter in China.

If there was once the idea of ​​launching a “sub-brand” on the ID family model, the VW Group has finally revised its plan by starting with something stronger, younger. But in this case, why not use the Cupra directly, which already benefits from such an image in Europe? “Creating a new brand image is very expensive“, comments the manager of the group. He mentions in particular the Skoda and Jetta models that did not succeed in China. Therefore, instead of trying to convince the Chinese with a known manufacturer in Europe, Volkswagen prefers to create a family within a family.