Audi-FAW Partnership Receives Approval for NEV Factory in China

A new energy vehicle project jointly managed by German luxury car brand Audi and Chinese auto giant FAW has recently received formal approval. The German brand will soon build a new electric vehicle (NEV) plant in the country’s northeastern province of Jilin.

According to a notice by provincial planning regulators, work on the plant is scheduled to last from April this year until December 2024. The two companies will together invest a total of 20.93 billion yuan ($3.29 billion) on the factory, which will produce three NEV models with an annual production capacity of 150,000 units.

The project is located in the Changchun Automobile Economic and Technological Development Zone, Jilin Province, with a total area of 2.46 million square meters, including automobile production workshops and control centers to cover links such as stamping, welding, painting, final assembly and battery assembly.

On October 13, 2020, Audi and FAW signed a memorandum of understanding, announcing the establishment of a new energy joint venture (JV) in China. The JV will be dedicated to the localized production of pure electric vehicles based on a premium architecture electricity (PPE) platform developed by Audi and Porsche. The first model will be launched in 2024.

On January 18, 2021, Audi, Volkswagen Group and FAW jointly announced that Audi FAW New Energy Joint Venture will settle in the city of Changchun, while the former two firms will hold 60% of shares in the company.

However, more than one year after the official announcement, no significant progress had been made. At the end of November, 2021, Reuters reported that the project is behind schedule due to a delay in approval by the relevant authorities. Now, it has finally ushered in a major step forward.

In the last two years, Audi has continuously increased its investment in new energy vehicles. According to the “Vorsprung 2030” strategy released by Audi last year, by 2025, Audi plans to invest 18 billion euros ($20.47 billion) in electrification and hybrid technology, and launch more than 20 types of pure electric vehicles. From 2026, Audi’s new cars for the global market will all be pure electric models. By 2033, Audi will gradually stop production of internal combustion engines and realize complete electrification.

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In 2021, Audi sold a total of 1.68 million cars worldwide, which was basically the same as that in 2020. But in the NEV market, Audi sold 81,894 units, a year-on-year increase of 57.5% . The Chinese market is the most important part of Audi’s global layout. Audi has sold 701,289 NEVs in China last year.