Photo/Yang Jun (NBD)

On May 10th, according to Bloomberg, Volkswagen Group will strengthen its partnerships and make use of external expertise in order to tackle the challenges it faces in developing its business in China and reshape its software business.  

At the annual shareholders' meeting on the same day, Volkswagen Group's CEO Oliver Blume stated that Volkswagen is "expanding cooperation in the software field and cooperating with local Chinese companies." Volkswagen also plans to transform classic models such as the Golf hatchback into more appealing electric vehicle models.

"Our logo must and will become a part of the future era of electrification," Blume emphasized. "As far as brand image is concerned, we must, will, and have the ability to position these models."

Despite Blume's ambitions, Volkswagen is facing frustrations in the Chinese market, which is the company's largest single market in the company.  

According to data released by the Volkswagen Group, the group delivered a total of 2.041 million vehicles worldwide in the first quarter of 2023, showing an increase of 7.5% year-on-year, but the carmaker's sales in China fell 14.5% to 644,500 vehicles.

By regions, about 70% of Volkswagen's all-electric vehicle sales came from Europe, China followed with sales of 21,500 all-electric vehicles, only contributing 15% of Volkswagen's global total. 

In terms of software, Blume is making comprehensive adjustments to Volkswagen's software subsidiary CARIAD. On May 8th, Volkswagen Group announced that it is pushing forward with a "comprehensive restructuring" of CARIAD. Peter Bosch, who previously headed Bentley's automotive production and manufacturing business, was appointed CEO, responsible for finance, procurement, and IT technology, and two software experts will also join the team.