Volkswagen Shutdown Its Joint Facility With SAIC Of China

Volkswagen (VW) and its Chinese partner, SAIC, have suspended production at a joint plant in China due to falling demand for cars with internal combustion engines.

VW also cited the acceleration of the transition to the production of electric vehicles and the optimization of the production network as reasons for this move, the Mina agency reports.

“Volkswagen Group and its partners are accelerating the transformation to the production of electric and smart vehicles. Many sites of SAIC’s partners are currently being converted or have already been converted to the production of electric vehicles,” explained the factory.

The reason for the suspension in Nanking, according to sources, is the factory’s urban location, which is not suitable for expansion and adaptation of the plant for the production of electric vehicles. The factory will be permanently closed in the second half of the year, and production will be moved to a plant in nearby Jiženg.

The Nanking plant began operating in 2008, and in 2011 it produced 300,000 vehicles.

Sales of electric vehicles have grown significantly in China, the world’s largest car market, in recent years. This forces European car companies, which have traditionally specialized in the production of petrol and diesel vehicles, to adapt their production.

VW is trying to counter the trend of declining car sales in China by using the knowledge of local experts. Accordingly, efforts are being made to coordinate and optimize the production network.

According to VW, deliveries of its vehicles to China were down a little more than two percent year-on-year in the first half of this year. Last year, for the same period, a decrease of 7.4 percent was recorded compared to the previous year.

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