Thu. Jan 27th, 2022


Volkswagen sold 10,000 fewer electric cars in China last year than expected, as deliveries to customers in its largest market were hit by semiconductor shortages amid fierce competition from local brands.

The German brand has sold 70,000 of its five flagship ID models, most of which were introduced during the past year, with sales ranging from 80,000 to 100,000 cars by 2021.

As a whole, the VW Group, which includes Audi and Porsche, delivered 3.3 million cars in China last year, 14 percent less than in 2020.

“2021 was one of the most challenging years in our history in China,” said Stephan Wöllenstein, the group’s longtime boss in the country, who will step aside later this year.

“While our order books were well stocked, we could not match production to demand due to a lack of semiconductors, with the situation further exacerbated by factory closures – both on our side and supplier’s side – due to Covid-19 cases.”

Volkswagen’s two joint ventures in China, with FAW and SAIC, have been the driving force behind the group’s growth for decades, and the country remains VW’s largest and most profitable market.

However, earnings in China have declined drastically over the past few years as the carmaker’s mass market offerings face competition from younger local brands such as BYD and Great Wall Motors.

VW’s five new ID models did not sell as well as hoped, and company executives told the Financial Times that Chinese buyers are moving to fresher electric brands, which are not associated with traditional car manufacturers.

As a result, VW is setting up showrooms that highlight the ID brand, expanding its online sales offering in hopes of selling at least 140,000 ID models this year.

However, Wöllenstein told reporters in a briefing on Tuesday that the targeted number “is not currently secured by the semiconductor supplies we are currently seeing”, although he remains confident of hitting it.

He added: “Looking ahead to this year, the chip supply situation for the first half will remain volatile, but we expect a progressive recovery, with production stabilizing over the course of the year.”

While VW’s electric sales fell, luxury brands Porsche, Bentley and Lamborghini set new annual records in 2021, with annual growth of 7.5 percent, 40 percent and 55 percent, respectively.

Porsche’s electric Taycan model sold out its popular 911 model, with more than 7,000 units delivered, compared to 4,000 of the 911s.



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