Automotive News Europe — 2025-01-28
Automotive Industry
Volkswagen Group CEO Oliver Blume has spoken to the carmaker’s Chinese joint venture partners about their interest in investing in Europe, a VW spokesperson said.
The spokesperson declined to comment on whether any discussions have taken place with joint venture partners on the topic of acquiring Volkswagen’s own plants.
Blume’s comments came after Reuters reported that Chinese officials and automakers are interested in buying German factories slated for closure and are particularly interested in VW’s sites. Reuters cited a person with knowledge of Chinese government thinking.
“When companies invest in Europe, create value, create jobs, that is always viewed positively. We have close partnerships in China - joint venture partners - and of course there are discussions, but no concrete decisions. Something like that must be carefully prepared,” Blume said.
He was speaking on the sidelines of a conference in Berlin on 28 January 2025 organized by German publication Welt.
VW has three joint venture partners in China — SAIC, FAW and JAC — and owns a stake in Chinese EV startup Xpeng, none of whom currently have production capacity in Europe.
VW is exploring alternative uses for its Dresden and Osnabrueck factories under a cost-cutting drive to downsize its German operations.
Two VW German car plants could interest Chinese partners
In a deal struck before Christmas, VW and labor representatives agreed to end production from 2027 in Dresden, a 340-worker plant that builds the electric ID3, from 2025, and in Osnabrueck, where 2,300 employees produce the T-Roc Cabriolet.
VW would be open to selling the Osnabrueck factory to a Chinese buyer, a person familiar with the company’s thinking told Reuters earlier in January.
Stephan Soldanski, a union representative from Osnabrueck, said workers at the plant would have nothing against producing for one of VW’s China-based joint venture partners. “I could imagine that we would produce something for a China joint venture but under the VW logo and under VW standards. That is the key condition,” he said.
Selling factories could be cheaper for VW than closing plants altogether, said a banker familiar with the carmaker, adding they could fetch €100 m to €300 m ($103 m to $309 m) each.
Building cars in Germany for sale in Europe would allow China’s EV makers to avoid paying EU tariffs on electric cars imported from China and could pose a further threat to European automakers’ competitiveness.
Investing in a VW car plant could mark China’s most politically sensitive investment yet. VW has long been a symbol of Germany’s industrial prowess but it is now threatened by a global economic slowdown hitting demand and a creaking transition to green technologies.
Chinese companies have invested across a range of industries in Germany, Europe’s biggest economy, from telecommunications to robotics.