Failure of the VW ID3, ID4, ID6, ID7 in China
- The battery electric vehicle market in China grew by 19% in 2025 compared to 2024, rising from 7,037,467 units in 2024 to 8,395,281 units in 2025, representing 28% of the Chinese market (compared to 25.5% in 2024), which is roughly in line with projections from a few months ago. There was an anticipation of purchases of 100% electric cars during the last months of the year which boosted the Chinese BEV market during this period. Indeed, the Chinese government has decided to increase taxes on electric vehicles and drastically reduce purchase incentives from January 1, 2026.
- Despite this strong growth in BEV sales on the Chinese market in 2025, production of battery electric Volkswagens collapsed last year, to 67,500 units compared to 173,500 in 2024 (which represents a drop of 60%).
- These are the ID.3, ID.4, ID.6, and ID.7 models, which are produced in China (the ID.5 is not produced in China). Together, these four models represent less than 1% of the BEV market in China in 2025.
- It's clear that Volkswagen's battery electric vehicles are struggling in China against models from local brands, and the German carmaker will have to completely overhaul its electric vehicle strategy for the Chinese market. Volkswagen is expected to cease production of these four models in China by 2026 and collaborate with a local carmaker, as Audi recently did with SAIC. It appears that projects with XPeng are already well underway (see VW ID. UNYX 07).
- It is certain that the decline in Volkswagen sales in China, which has been constant for several years, is mainly due to the carmaker's difficulties in establishing itself in the promising BEV market in that country.