German automobile company Volkswagen is to invest €2 billion to increase its stake in China’s Electric Vehicles industry. Half of that amount goes toward increasing VW’s share in JAC Volkswagen, its joint venture with Chinese EV manufacturer JAC, from 50% to 75%. VW is doing this by taking a 50% stake in JAG, JAC’s parent company. For the other half of the amount, VW is acquiring a 26% stake in Gotion High-Tech, an EV battery manufacturer. This makes VW the largest shareholder in the company.
The investment matches VW Group’s high aspirations for China’s EV market, which is growing on the back of government support and subsidies for the program, making it one of the world’s largest. The group plans to build an EV factory at Hefei and launch five EV models. From 2023, JAC VW expects to build EVs on VW’s Modular Electric Drive matrix, a.k.a. MEB. By 2025, Volkswagen expects to sell 1.5 million EVs in China. This figure comprises full-electric EVs (BEVs), plug-in hybrids (PHEVs) and fuel-cell EVs (FCEVs).