Volkswagen appears to be forging a new electric vehicle (EV) partnership in China, distinct from its existing collaboration with XPeng Motors. Volkswagen is reportedly in talks with Chinese electric vehicle (EV) startup Leapmotor, based in Hangzhou, to leverage the latter’s expertise and potentially outsource production of its Jetta model.
Volkswagen’s Jetta brand reportedly engages in discussions with Leapmotor, leveraging the latter’s expertise to develop “affordable electric vehicles,” according to unnamed sources quoted by Cailian media.
A spokesperson for FAW confirmed to journalists that a confidential document reveals the company is in talks to partner with Leapmotor on its Jetta model, following a similar agreement with XPeng.
Notwithstanding any agreement, it is expected that this partnership will differ significantly from that with XPeng Motors.
Volvo will leverage XPeng’s versatile Edward platform, employed in the G9 and P7 models, to introduce two innovative electric vehicles. The automaker has committed $700 million to acquire a nearly 5% stake in the Chinese electric vehicle manufacturer.
Audi has further solidified its commitment to electric vehicle (EV) growth in the region by partnering with China’s state-owned automaker SAIC, just one week after announcing plans to accelerate this expansion.
Volkswagen is reportedly in talks to form another electric vehicle (EV) partnership with a Chinese firm.
Volkswagen’s upcoming electric vehicle (EV) partnership is expected to mirror the Audi-SAIC alliance rather than the XPeng agreement. According to the report, there is a strong likelihood that FAW-Volkswagen may finally “buy into” significant zero operating platform expertise.
Although Jetta was once a popular Volkswagen model, the company rebranded it as a standalone marque in 2019, distancing itself from its traditional offerings.
Since its introduction, Jetta has faced challenges in gaining momentum due to the increasing demand for electric vehicles (EVs). According to the latest report, Volkswagen’s Jetta brand saw a significant decline in gross sales, dropping by 13.48% year-over-year to approximately 146,900 units sold last year.
According to business insiders, the next three years are poised to be pivotal in driving the growth of automotive intelligence. German automobiles excel in terms of hardware, but fall short when it comes to software developments.
As the electric vehicle market evolves, consumers are increasingly drawn to software-defined vehicles that prioritize intelligence over aesthetics in their purchasing decisions. The business insiders claimed:
Should a collaboration with Leapmotor materialize, Volkswagen would rely heavily on the technological prowess of Chinese automakers to compensate for its own weaknesses in intelligent driving technology.
German automaker Volkswagen is eager to tap into the innovative vehicle technology developed by China’s automotive sector, seeking to offset its own industry shortcomings.
Several Jetta and Leapmotor fashion models, including the VS5 and VS7, fall within the same price range, making their collaboration more feasible.
As Leapmotor unveiled its innovative EV platform this week, CEO Zhu Jiangming hinted at imminent agreements with two international car manufacturers to license their cutting-edge technology.
Electrek’s Take
Volkswagen’s sales floor in China has been plagued by inventory shortages, prompting the company to accelerate marketing efforts to drive demand and fill the gap. Germany’s leading automaker saw its passenger vehicle sales outpaced by Chinese electric vehicle manufacturer BYD during the initial quarter, with BYD maintaining its advantage through July.
According to the report, while Volkswagen may struggle to keep pace with competitors like BYD and Tesla, it is also facing challenges from up-and-coming electric vehicle manufacturers such as NIO, XPeng, and Li Auto that are increasingly encroaching on the same market segments where VW operates.
If the cope with Leapmotor materializes, Volkswagen is likely to heavily rely on Chinese technology to sustain sales in its key market.
