Key facts
- Volkswagen's annual vehicle sales in China decreased by 8% in 2025, reaching 2.7 million units.
- New energy vehicle (NEV) deliveries for Volkswagen in China saw a substantial drop of 44.3% in 2025, totaling 116,000 units.
- Internal combustion engine (ICE) vehicles constituted 96% of Volkswagen's sales in China in 2025.
- Volkswagen is implementing its 'In China, for China' strategy, developing vehicles locally.
- The company unveiled 10 new models, with a focus on electric and hybrid powertrains, at an event in April 2025.
Volkswagen is facing renewed doubts about its comeback strategy in China, as the German automaker's sales in the world's largest car market declined by 8% in 2025 to 2.7 million units. The company's new energy vehicle (NEV) sales plummeted by 44.3% to 116,000 units, highlighting a significant challenge in adapting to the rapidly evolving market dominated by local competitors like BYD and Geely.
Despite unveiling 10 new models tailored for Chinese consumers and emphasizing its 'In China, for China' strategy, Volkswagen remains heavily reliant on traditional internal combustion engine (ICE) vehicles, which accounted for 96% of its sales in 2025. This reliance comes as NEVs surpassed ICE vehicles in China during the same year.
Volkswagen's efforts to localize development include a substantial investment in Horizon Robotics and the establishment of a large engineering center in Hefei. However, the company acknowledges the formidable competition, with Chairman Oliver Blume and CEO Ralf Brandstaetter expressing confidence but also recognizing the ongoing challenge and the speed of Chinese automakers. Brandstaetter noted that Volkswagen prioritizes quality, safety, and reliability alongside digitalization, a balance that may not match the pace of local rivals.
The sales slide in China, Volkswagen's largest market, also impacted its global performance, contributing to a 0.5% decrease in worldwide sales to just under 9 million vehicles, even as sales grew in other regions.