Volkswagen Bets Big on China With New EV Lineup

Volkswagen is sprinting to reinvent itself in the country that once powered its profits—and now threatens its future. In the Wall Street Journal, Stephen Wilmot reports from Hefei, where the German giant has sunk $3.5 billion into a sprawling research hub and a new line of "in China, for China" electric vehicles aimed at winning back drivers who've drifted to local brands. "Chinese consumers used to look at Volkswagen and think quality. Now they think old," said Michael Dunne, CEO of Dunne Insights.

The ID. Unyx 07 sedan is the first of more than 20 models VW will roll out in China this year, built with Chinese partners like Horizon Robotics and EV startup Xpeng to boost autonomous driving and software chops. The pivot is dramatic: China used to license VW tech; now VW is buying Chinese know-how as its China profit has plunged from about $5 billion a decade ago to under $500 million. Analysts say the revamped cars are much better—but still not at the cutting edge in a market where Huawei-powered vehicles can handle dirt roads; VW vehicles won't even be able to tackle urban roads until later in 2026. "Volkswagen has now basically burned all its fireworks," said Thomas Luk, a China-based consultant. "My question is: Are they ready to burn the next stage of fireworks?" For the full picture on VW's high-stakes China gamble, read Wilmot's piece at the Wall Street Journal.