In the short term, Volkswagen will continue to produce combustion-engine cars, which generate profits that the company needs to pay for the transition to battery-powered vehicles. In 2022, Volkswagen sold 8.2 million cars and trucks.
Despite the German government’s call for companies to diversify their operations in Asia, pivoting away from China, Volkswagen is continuing to invest in the country in partnerships with local companies.
Volkswagen is the leading producer of combustion-engine vehicles in China, but has lost ground to domestic carmakers in the fast-growing market for electric cars. Last year, Volkswagen introduced an “in China for China” strategy that it plans to expand, including developing technology and software specifically for consumers there, including in-car karaoke.
The automaker’s problems in North America are somewhat different. After years of trying to become a bigger player in the United States specifically, it remains far behind U.S. automakers like General Motors and Ford Motor and Asian companies like Toyota and Hyundai.
Volkswagen retooled its plant in Chattanooga, Tenn., last year to begin producing electric vehicles, and it now produces the ID.4 sport utility vehicle there. On Monday, Volkswagen said it had chosen a site in Ontario for a new battery plant. And earlier in March, the company said it would put up a factory in South Carolina to build pickup trucks and S.U.V.s that would be sold under the moribund Scout brand.