With planned investments worth more than two billion euros, Volkswagen wants to further expand its involvement in electric cars in China.
The Volkswagen Group is pushing its electric offensive in China with investments worth billions. The Wolfsburg-based company is increasing its stake in the JAC Volkswagen electrical joint venture. The group announced on Friday in Beijing.
Accordingly, the parties signed a letter of intent to increase the Volkswagen Group’s stake in the Chinese electric car joint venture JAC Volkswagen through a capital increase from 50 percent to 75.
Volkswagen takes over half of the JAG group
To make this possible, Volkswagen will take over half of the Chinese JAG group, the parent company of JAC. Around a billion euros would be invested in this context. In addition, Volkswagen announced that it would take over 26 percent of the Chinese battery company Gotion High-Tech for 1.1 billion euros and thus become the largest single shareholder. The deal is scheduled to be completed by the end of the year.
The partnership enables Volkswagen to gain more expertise in the field of batteries. “Together with strong and reliable partners, Volkswagen is strengthening its electrification strategy in China,” said VW boss Herbert Diess according to the message. The segment of electric cars is growing rapidly in China.
China is by far the largest single market for the VW group. Batteries are considered a scarce commodity in the ramp-up of electromobility, so carmakers are trying to secure sufficient capacity in various ways. The People’s Republic is considered the leading market for electric cars because the Chinese government wants to fight the bad air in the country’s big cities and become a technology leader.