Volkswagen Could Begin To Sell Its Chinese Models In Europe

Volkswagen could begin production and sales in Europe of some of its advanced new models originally intended exclusively for the Chinese market, such as the ID Unyx 09 sedan. The move is part of the German giant’s effort to accelerate business transformation and increase global competitiveness after a recent drop in profits, Autocar writes.

After announcing its first-quarter financial results, which showed a 14 percent drop in operating profit to 2.5 billion euros, chief executive Oliver Blume said the company had made “visible progress” in its transformation plan despite global challenges. However, he added that “we have to step up efforts in transformation”.

Other measures include a more focused approach to technology, simplification of the management structure at the group level, increased efficiency and optimization of production capacity to around nine million cars per year.

Adapting the manufacturing strategy is seen as key to competing with Chinese rivals who have much simpler production networks, especially as those companies begin building factories in Europe.

Blume described closing factories as the “worst and most expensive option” and said the Volkswagen Group is considering how to use existing capacity for other projects. Although the initial focus is on taking over jobs from the defence industry, Blume said he is open to the idea of ​​the company producing models developed for China in its European facilities, whether they are Volkswagen models or those of partner firms.

The company recently introduced a new Compact Main Platform (CMP), developed exclusively for China in cooperation with the Chinese firm Xpeng. The platform has an advanced electrical architecture and will serve as the basis for a range of locally produced electric vehicles.

The first models on that platform, including the Volkswagen ID Aura T6 SUV and the ID Unyx 09 sedan, were unveiled at the recent Beijing Auto Show. Blume hinted that these models could be exported to markets such as South America, Asia, the Middle East and India.

China Models Could Be Produced In Europe

“It is too early to decide on the localization of the Chinese platform in Germany, but if we were to do so, our priority would be to use one of our own platforms first,” said Blume. “This year, we are accelerating the development of the CMP platform, which should be ready in China in 2027. That is the first step, and only after that we can consider options for Europe and see which products would be suitable.”

He added, “We are currently gathering market feedback on our first new product in China. Depending on the success we achieve there, we will see which models would be suitable for Europe, especially in segments where we are not represented with our existing portfolio.”

Blume said the “second step” could be to offer European production capacity to some of the Chinese partners, which include SAIC, the owner of MG, and FAW. He called it potentially “a smart solution for utilizing excess capacity”

The development of platforms exclusively for China is part of the Volkswagen Group’s broader strategy to regain its dominant position in that region. After being the leading player in the market for years, Volkswagen has recently been facing strong competition from domestic brands, and its sales in the first quarter of 2026 fell by 20 percent compared to the same period last year.

Blume pointed out that a “strong presence” in China allows the western part of the business to learn from China’s “innovation, speed and business practices”. He called the Chinese ecosystem “a model for future architecture, including the one we are developing with software partner Rivian for the Western world”.

• Also See: Volkswagen Is Cutting Back On Production By An Additional Million Cars