SAIC Volkswagen to become second JV to produce Audi cars
Joint venture may start with online sales to avoid conflict with FAW-Volkswagen, Li Fusheng reports.
SAIC Volkswagen Automotive Co has decided to set up an Audi division, becoming the second joint venture to localize and sell cars with the fourring emblem in China after FAW-Volkswagen.
The Shanghai-based carmaker’s executive vice-president of marketing and sales will take charge of the division, said Chinese magazine Automotive Business Review quoting a person familiar with the matter last week.
The person said that the division will adopt a new business mode but did not elaborate further on it, while the magazine said that SAIC Volkswagen might first try online sales of Audi cars, which would prevent head-on conflicts with the brick-andmortar sales network FAWVolkswagen has built.
Audi China told China Daily in a statement that it is “currently preparing the related processes and structures with our partners.”
It added, “The SAIC-Audi project is progressing on schedule as agreed with all stakeholders.”
Audi and SAIC inked the deal to localize and sell Audi cars in late 2016. FAW-Volkswagen, Audi’s first partner in China, has been producing and selling the absolute majority of Audi cars in the country.
SAIC Volkswagen’s move to set up an Audi division comes after the premium German marque acquired a 1 percent stake in the joint venture in late June.
Equity ownership in a joint venture is a prerequisite for international carmakers to localize models in China, according to the country’s industrial policies.
Currently, SAIC holds a 50 percent stake in the joint venture; Volkswagen AG, 38 percent; Volkswagen Group China, 10 percent; and Skoda Auto, 1 percent.
The localized all-new Audi Q5L attracts visitors at an auto show in Changchun, Jilin province.
The SAICAudi project is progressing on schedule as agreed with all stakeholders.”
Audi China