Volkswagen’s Audi in talks with China’s SAIC Motor on tie-up
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Volkswagen’s Audi premium brand is in talks with China’s largest automaker, SAIC Motor, on a potential long-term collaboration, Audi said in a statement on Monday.
Reuters reported on Saturday, citing a source familiar with the matter, that the two had signed an agreement that could pave the way for Volkswagen’s joint venture with SAIC to make Audi brand cars.
An early entrant to China, the world’s largest car market, Audi is the best-selling premium car brand although it is rapidly losing ground to newer car models from Daimler’s Mercedes-Benz and non-German automakers like Toyota’s Lexus and General Motor’s Cadillac.
Audi cars are now only made in China through a joint venture with China FAW Group, providing a lifeline to a state-owned company whose own brand cars have struggled with falling sales.
Audi reaffirmed its commitment to FAW in the release announcing the talks with SAIC, saying it had outlined growth plans with FAW for the next 10 years that include making green energy SUVs and sedans in every major segment.
Audi will also form a new joint venture company with FAW to be based in Beijing and focus on mobility and digital services, according to the statement.
Questions & Answers
Q.What is the primary reason for Audi's discussions with SAIC Motor?
What is the primary reason for Audi's discussions with SAIC Motor?
Audi is in talks with SAIC Motor regarding a potential long-term collaboration. This could lead to Volkswagen's existing joint venture with SAIC manufacturing Audi brand cars, expanding Audi's production footprint in China.
Q.How will a potential agreement with SAIC Motor affect Audi's existing partnership with China FAW Group?
How will a potential agreement with SAIC Motor affect Audi's existing partnership with China FAW Group?
Audi has reaffirmed its commitment to FAW, outlining growth plans for the next 10 years including new green energy SUVs and sedans. They will also form a new joint venture with FAW in Beijing for mobility and digital services.
Q.Why is Audi seeking additional manufacturing partnerships in China?
Why is Audi seeking additional manufacturing partnerships in China?
Despite being the best-selling premium car brand in China, Audi is rapidly losing ground. Newer models from competitors like Mercedes-Benz, Lexus, and Cadillac are impacting its market share, prompting a need for strategic adjustments.
Q.What type of vehicles does Audi plan to develop with FAW in their future growth strategy?
What type of vehicles does Audi plan to develop with FAW in their future growth strategy?
Audi plans to produce green energy SUVs and sedans across every major segment as part of its growth plans with FAW over the next decade. This indicates a focus on electrification and broader model offerings.