Volkswagen (VW) and its Chinese partner SAIC are planning the closure of their joint plant in Nanjing, China, which represents a significant strategic decision. Production at this plant has already been halted, and the closure is set to be implemented gradually in the second half of 2025.
Background and Reasons
The plant was opened in 2008 and originally had an annual capacity of 360,000 vehicles. Recently, it primarily produced internal combustion models such as the VW Passat and the Skoda Superb, but with significantly reduced utilization. The proximity of the location to the densely populated city center of Nanjing considerably hampered renovations and logistical processes. A conversion of the plant to electric vehicle production was deemed too costly and inefficient, leading VW to dismiss this option.
Relocation of Production
The remaining production is to be relocated to the neighboring site in Yizheng, approximately 70 kilometers away. The premises of the Nanjing plant will be returned to the city.
This measure is part of a comprehensive strategy realignment by Volkswagen to optimize its production network in China. For investors in DAX companies, this is relevant as such decisions can indicate changes in corporate strategy – such as a stronger focus on more efficient locations or electromobility – as well as potential impacts on market shares due to production relocations.
Summary of Facts
| Aspect | Details |
|---|---|
| Plant | Joint VW-SAIC plant in Nanjing |
| Status | Production halted; gradual closure in the second half of 2025 |
| Produced Models | VW Passat, Skoda Superb (internal combustion) |
| Reason for Closure | Location near city center complicates renovation & logistics; no efficient EV conversion possible |
| Future of the Site | Return to the city |
| Relocated Production | To Yizheng (approx. 70 km away) |
| Strategic Background | Part of comprehensive production optimization at VW |
This development marks the first time Volkswagen has closed an entire plant in China and signals a shift in local manufacturing strategy towards more efficient structures.