Audi to Build Electric Vehicles in China in a New Joint Venture with Automaker FAW Group

author: FutureCar Staff    

From left: Stephan Wöllenstein (CEO Volkswagen Group China), Dr. Clemens von Goetze (German Ambassador China), Dr. Liu Yunfeng (Executive Vice President Volkswagen Group China), Werner Eichhorn (President Audi China) signing.

German automaker Audi AG is expanding its presence in China, which is the world's biggest auto market. Audi announced on Monday a new company with Chinese automaker FAW for the future production of electric vehicles in Changchun in the northeast of China.

The Board of Management of Audi, Supervisory Board of the Volkswagen Group and Board of Management of the FAW Group confirmed that Changchun will be the headquarters of the new company named "Audi-FAW".

The two automakets held a ceremonial signing today in Changchun and Beijing.

The newly formed venture with FAW will also position Audi for future success in China's growing New Energy Vehicle (NEV) market. NEVs include plug-in hybrids as well as fully-electric vehicles. The partnership with FAW will allow Audi to increase the number of locally produced models to 12 by the end of 2021, the automaker said. 

FAW is one of China's biggest automakers. The company sold more than 1.63 million vehicles in the first half of last year.

"With the new Audi-FAW company in Changchun, we are further expanding our presence on the Chinese market and strengthening our position as a manufacturer of fully electric premium vehicles through local production," says Markus Duesmann, Chairman of the Board of Management of AUDI AG and the person responsible for business in China. 

Changchun is also the headquarters of the joint venture FAW‑Volkswagen, which Audi has been involved in for over 30 years. The FAW-Volkswagen joint venture was established in 1988 and produces models locally.

Audi and its parent Volkswagen Group China will hold a 60-percent stake in the company. The company will focus on the local production of fully electric Audi models which will be built on the automaker's "Premium Platform Electric'' (PPE) EV platform. The PPE was co-developed with Porsche.

The first PPE model produced jointly with FAW in China is scheduled to start by 2024. 

"This deepened partnership between Audi and FAW heralds a new era of electrification as the next ‘golden decade' for Audi on the important Chinese market," said Werner Eichhorn, President of Audi China.

He added, "In doing so, we are continuing the Audi success story in China and actively helping to shape the transformation of the Chinese automotive industry as it moves toward sustainable mobility." 

The founding of the new PPE company is officially scheduled for the first quarter of 2021, just as soon as the consent of all stakeholders and the Chinese regulatory authorities has been obtained, Audi said in a press release. 

"This deepened partnership between Audi and FAW heralds a new era of electrification as the next ‘golden decade' for Audi on the highly important Chinese market," said Eichhorn.

FAW Audi Sales Co., Ltd. will be responsible for marketing and selling Audi models produced locally by FAW-Volkswagen as well as Audi import vehicles and future cars produced at the joint PPE plant, the company said.

The models produced by its second partner, SAIC Volkswagen, are set to be introduced in 2022.

To date, Audi has so far delivered almost 7 million vehicles in China. In 2020, Vokswagen's luxury division Audi sold 727,358 vehicles in China, the highest number of vehicles since its joint venture was established in 1988.

In October when the joint venture partnership with FAW was first announced, Audi said its fully-electric e-tron SUV would be built at the Changchun plant operated by the FAW-Volkswagen joint venture. 

Audi and FAW are already jointly building the all-electric Q2L e-tron and the plug-in hybrid A6L TFSIe in China. The e-tron SUV was previously imported from Brussels, Belgium, but production in Changchun began at the end of September.  

By 2025, Audi plans for one third of the vehicles it sells in China to be electrified.

FutureCar Staff