Volkswagen has placed a major bet in the Chinese electric vehicle (EV) market as they have invested over $3.2 billion CAD (2.1 billion euros) in two separate deals announced on Friday.
The first deal will see VW invest approximately $1.6 billion CAD into the Chinese state-owned Anhui Jianghuai Automobile Group (JAC Motors), giving it a 50% stake in the company.
The investment will also see VW take full management control of the its existing electric vehicle joint venture with JAC by raising its stake to 75% from 50% (via Reuters).
The other $1.6 billion CAD of the deal will give VW a 26.5% stake of Guoxuan High-tech Co Ltd, a maker of electric vehicle batteries. In the deal, VW will become the company’s biggest shareholder.
Despite the coronavirus pandemic making a major impact on many auto manufacturers, Volkswagen’s China chief Stephan Woellenstein said the deals show the German automaker is not changing its long term EV strategy in China.
