We need to change our approach in China

Volkswagen boss Herbert Diess said in the first half 2021 financial results report that the company needs to change its approach to electric car sales in China.

The volume of 18,285 all-electric cars in the first half is lower than expected (only part of that falls on the ID.4, which is a worrying sign). We assume ID.4 result (X and CROZZ models) to be less than 8,000 at the end of June (others are older models / other BEVs).

The target for 2021 is 80,000 to 100,000 IDs. electric cars, which means that in the second half of the year, the company is expected to sell at least three times as many BEVs as so far this year.

Herbert Diess explains that electric car buyers are much younger and different from his existing customer base in China, which requires a different approach:

“Sales are increasing, but it requires a different focus and approaches, because electric vehicle customers are much younger and different from our customer base than we have with more traditional brands like Volkswagen in China.”

“We notice that we have to change our approach”,

“We have the financial strength, we have the sales network, we are offering new formats in shopping centers, we are becoming much more digital and things are going fast because we are much faster in China than in the rest of the world. world.”

One of the main things to improve will be more identification. commercial sites in China (150 at the end of 2021).

Lower than forecast BEV sales are important not only directly (revenue) but also because of emissions requirements. Industry analyst Matthias Schmidt notes that Volkswagen Group will likely have to buy credits in China / US

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