In a bid to regain its position in the world's largest auto market, Volkswagen has announced its intention to produce the majority of its vehicles in China by 2030. The company plans to leverage a new electronic architecture platform developed in partnership with EV maker Xpeng to achieve this goal.

This innovative architecture allows Volkswagen to expedite car development by up to 30% and reduce costs by 40% compared to using the previously employed German-developed MEB platform. Centralized control units and increased in-house component production are key factors contributing to this efficiency, according to company officials.

Liu Ran, a spokesperson for Volkswagen Group China Technology, revealed that the company aims to adopt the software-driven China Electronic Architecture (CEA) for "most of its cars" in China by 2030. This announcement was made during a visit to Volkswagen's expansive manufacturing facility in Hefei, eastern China.

Facing tough competition from local rivals such as BYD and Geely, Volkswagen has seen a decline in its market share in China. To stay competitive, the company is focusing on rapid model development, incorporating smart features to cater to evolving customer preferences.

Despite being overtaken by BYD in 2024 and slipping to third place in the Chinese market last year, Volkswagen remains optimistic about its future prospects. The company's Hefei hub, equipped with a CEA lab staffed by around 850 engineers, is focused on aligning with Chinese standards and customer preferences to drive success.

Finn Cemmasson, leading the validation team for architecture integration with in-vehicle hardware, emphasized Volkswagen's commitment to adapting to Chinese market dynamics. The company has already commenced production of its first China-built vehicle, the electric SUV "ID. UNYX 07," and plans to introduce four more models this year.

Looking ahead, Volkswagen aims to launch an additional 10 models on the CEA platform next year, including some combustion-engine cars. The collaboration with Xpeng on the architecture concluded last year, with Volkswagen taking over the development responsibilities.