Volkswagen is facing trouble with its electric vehicle strategy for the European market. Indeed, Volkswagen recently announced a two-week pause in EV production, citing lower than anticipated demand. A two-week pause effectively means production cuts. Volkswagen’s ID range of electric cars is underwhelming and overpriced, consumers have more choice with superior offerings and competitive pricing from Tesla and China. Indeed China marked a significant milestone today with the GAC Aion Hyper GT which became the 20 millionth New Energy Vehicle (NEV) sold in China.

Representatives from China’s largest auto manufacturers were present to mark the event at a celebratory ceremony in Guangzhou, China. There are three types of New Energy Vehicles (NEVs): Battery Electric Vehicles (BEVs), Plugin Hybrid EVs (PHEVs), and range extenders (EREVs). Mild hybrids and hybrids are not included in the NEVs category.

It took China 27 years since the start of NEV production in 1995 to reach the milestone of 10 million NEVs sold. However, since February 2022 the next 10 million NEV milestone was achieved in 1 year and 5 months. Chinese brands dominate the NEV market with a 53 percent share of sales, and NEVs have a 27 percent market penetration.

Chinese consumers spend on average between $27,000 USD and $41,000 USD (200,000 – 300,000 yuan) for a new NEV. China boasts a whopping 140 automotive brands and is currently the leading the world in electric vehicle technology and production. The difference is strikingly evident when comparing Volkswagen’s troubles with its EV strategy to that of China.