Volkswagen, a leading European automaker, has announced short-term discounts in the fiercely competitive Chinese automotive market. Ralf Brandstaetter, a board member overseeing Volkswagen’s operations in China, unveiled these reductions as part of a comprehensive cost-cutting program targeting the modular electric architecture MEB, initiated last year.

Benefits Extended to Customers

Speaking at the IAA car show in Munich, Brandstaetter emphasized the discernible results of their cost-saving efforts. These benefits have been promptly extended to customers, notably concerning the ID.3 model. While the exact discounts in China were not disclosed, Brandstaetter emphasized their temporary nature.

Volkswagen Distinct Approach Amidst Pricing Wars

In contrast to rivals implementing drastic price cuts of up to 50%-60%, Volkswagen clarified that their adjustments are standard short-term “marketing measures.” They highlighted a campaign for SUV models in partnership with China’s SAIC, offering discounts ranging from 30,000 to 60,000 yuan ($4,108-$8,216) in August. However, this program has concluded.

Volkswagen Addressing Concerns Over Xinjiang Plant

Brandstaetter underscored Volkswagen’s commitment to transparency and vigilance in monitoring concerns regarding the Xinjiang plant, which has faced allegations of human rights abuses.

Volkswagen Profitability Remains Top Priority

Acknowledging the pricing competition sparked by Tesla, Brandstaetter emphasized Volkswagen’s unwavering focus on profitability. He affirmed that the company will not rush electric vehicle releases to the market if it jeopardizes profitability. Volkswagen currently derives satisfactory profits from its non-electric vehicle business, underscoring their deliberate approach to navigating the evolving electric vehicle landscape while maintaining financial stability.

Tags:  Chinese automotive market ID.3 model discounts Modular electric architecture MEB Volkswagen China discounts Volkswagen cost-cutting initiative Xinjiang plant Volkswagen