SAIC Volkswagen's Plan to Close Nanjing Factory and Skoda's Situation
TapTechNews September 19th news, on the 18th, Bloomberg and Reuters quoted informed sources as saying that SAIC Volkswagen plans to close its factory located in Nanjing, Jiangsu next year. This factory produces Passat and Skoda's models, with an annual production capacity of 360,000 vehicles.
Informed sources said that some workers in the Nanjing factory will be informed to move to SAIC Volkswagen's Yizheng factory to work. This factory currently produces the brand's best-selling sedan Lavida. However, the company has not yet had a clear transfer schedule and has not yet decided whether to completely close the factory or sell it. SAIC Volkswagen is also brewing a plan to revitalize Skoda's sales. The Skoda brand only accounts for 1% of SAIC Volkswagen's total sales, while in 2018, Skoda's sales accounted for 17%.
Volkswagen AG confirmed that after a sharp drop in sales, the partner is also conducting a strategic review of Skoda, highlighting the huge difficulties it faces in China. The aforementioned informed sources said that a factory in Ningbo, Zhejiang that produces multiple Skoda models has been shut down for several months and is considering closing.
In an email reply to Bloomberg's question, Volkswagen China said: All SAIC Volkswagen's factories are operating normally in accordance with market requirements and the company's forecasts. As the focus shifts to smart electric vehicles, the company is also gradually transforming vehicle production and parts factories.
According to a previous report by TapTechNews, Fu Qiang, the deputy general manager of sales and marketing of SAIC Volkswagen, said earlier this month that he is not optimistic about some joint venture companies choosing to lie down. He believes that once you lie down, you will never be able to get up again, and by then the price to come back is much more than the price of not lying down and continuing to stand at the beginning, and the market has forgotten this brand. So SAIC Volkswagen's choice is very firm. There will be a strategy and play in the transition period, and some interests are temporarily sacrificed, but what is won is the battlefield in the future.
In August this year, SAIC Group's new energy vehicle sales exceeded 86,000 units, and the cumulative sales of new energy vehicles from January to August was 619,000 units, an increase of approximately 11% year-on-year.