Wednesday, February 19, 2025

German car factories could be sold to China, VW says

Volkswagen now confirms that it is looking into whether the factories the brand will close can be sold to and operated by Chinese car brands.

Volkswagen confirms that the car factories the brand plans to close in Germany could end up being sold to Chinese car brands.

The Chinese come into the picture because the closures or sale of the factories are part of a larger savings plan from which Volkswagen will collect billions of kroner.

Audi, which is part of the Volkswagen Group, has previously announced that the brand will close its only factory in Belgium – the one in Brussels – at the beginning of 2025. The closure means that there is only one car factory left in the entire country. It is owned by Volvo.

Now the German group is considering selling additional car factories in Germany, something that has never happened before.

"Of course it's conceivable. It would lower the barrier to entry for these competitors. I believe in free trade," says Audi CEO Gernot Döllner in an interview with the Financial Times .

Volkswagen's chief financial officer, David Powells, also confirms that selling car factories to Chinese car manufacturers is an option.

"We are open to any discussion on any topic with any partner," he told the Financial Times.

– In a dynamic world, you have to keep all options open.

Chinese car brands have so far had limited success selling cars in Europe. Many of the Chinese-made cars sold in Europe come from brands like Tesla, Volvo and Polestar, which do not market themselves as Chinese.

By establishing car factories in Europe, Chinese manufacturers can better adapt their cars to European demand. Japanese and Korean car manufacturers have long produced cars for the European market locally in Europe.

Nissan, for example, has a huge factory in England. But the Japanese have already warned that the British government's requirements for electric cars could end up meaning the loss of thousands of jobs. Read more about it here .

Back in Germany, selling off the Volkswagen factories could also be a way for the Chinese brands to escape the EU's punitive tariffs. The additional tariffs are aimed exclusively at electric cars produced in China.

However, the tariffs also affect the Volkswagen Group. The breakaway brand Cupra will have the Tavascan electric car built on one of Volkswagen's joint venture assembly lines in China.

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