Serving the World's Largest Emerging Automobile Market
Home > OEM News > SEAT signs new agreement to strengthen China entry strategy, Volkswagen to set up Smart City project in Hefei

SEAT signs new agreement to strengthen China entry strategy, Volkswagen to set up Smart City project in Hefei

MARTORELL, Spain – The return of SEAT to the Chinese market took another major step on May 27 when the Spanish brand, Volkswagen Group China and JAC signed an agreement that enables further progress in its market entry planned in 2-3 years.

The agreement specifies the collaboration among the partners and the strategy towards the future of their joint venture JAC Volkswagen, which was founded in 2017 to develop, produce and sell battery electric vehicles under the SOL brand. The JV will become a globally integrated member of the Volkswagen Group and play an active role in its manufacturing network.

The agreement is the third within the last nine months the three partners have signed to bring SEAT, the only Volkswagen Group brand that does not yet have a presence in China, back to the Chinese market utilizing the JAC Volkswagen joint venture. When it does, around 2021 if progress is smooth, it will be a pure electric brand only.

Left to right: An Jin, Li Jinbin, Ling Yun, Stephan Wöllenstein, Dr. Herbert Diess, Weiming Soh

The agreement was signed at the SEAT headquarters in Martorell (Barcelona) during a visit from a Chinese government delegation led by Anhui Provincial Governor Li Jinbin and Ling Yun, Mayor of Hefei, the provincial capital where JAC and JAC Volkswagen is based. SEAT CEO Luca de Meo, Volkswagen Group China CEO Dr. Stephan Wöllenstein and JAC Chairman An Jin inked the agreement in the presence of Li and Volkswagen Group CEO Dr. Herbert Diess.

The new R&D center for JAC Volkswagen is the cornerstone of achieving the objective of developing mobility solutions and it will integrate, among others, capabilities to co-develop smaller e-cars and components and conduct research into technologies for automotive applications. Currently under construction, it is scheduled to open in 2021.

“In the world’s largest market for electric mobility, the close cooperation between SEAT and JAC will allow us to create synergies, which will significantly increase our market coverage. Notably, the smaller electric cars segment is growing rapidly and offers a lot of potential,” said Dr. Diess.

“The signing of this agreement is a new step forward in the strategic plan for the globalization of SEAT,” said de Meo. “With the introduction of our business in China, we are boosting the future of the company and of electric mobility at the same time. Today, China is the benchmark country for electric vehicles. We aim to be a part of this ecosystem in order to exchange knowledge and make progress in achieving global mobility that is more sustainable.”

Already this year, the range of electrified vehicles will be expanded. By 2028, more than half of the 22 million e-cars planned by the Group will be produced in China. The goal is to deliver around 1.5 million electrified vehicles, most of them pure e-cars, to customers annually by 2025.

Last July, SEAT, Volkswagen Group China and JAC signed an agreement in Berlin, in the presence of German Chancellor Angela Merkel and Chinese Premier Li Keqiang, whereby SEAT became a partner in JAC Volkswagen, and was designated the Volkswagen Group’s lead brand in this project. Since the founding of the JV in 2017, SEAT has been contributing its know-how in the areas of design and R&D.

A further agreement was signed last November in Madrid, which specifies the development of a platform for the introduction of electric vehicles and the creation of the R&D center in Hefei. The agreement was signed by Dr. Diess, An and de Meo, in the presence of Chinese President Xi Jinping and Spanish Prime Minister Pedro Sánchez.

In addition to the next steps for SEAT and JAC Volkswagen, another agreement was signed to focus on the development of future mobility solutions.

In a smart city partnership with Hefei, requirements and demand for future mobility in a fully connected city are to be tested and smart mobility solutions will be developed. The strategic framework agreement was signed by Volkswagen Group China and its associated mobility company Mobility Asia, as well as JAC and the government of Hefei.

“Volkswagen Group China is already exciting millions of Chinese customers with a wide range of vehicles. With this cooperation, we demonstrate that we are working hard to take a leading role in the field of smart mobility solutions in the Chinese market as well,” said Dr. Wöllenstein.

The initiative will give Volkswagen the opportunity to test new technologies, business models and products in a connected smart city environment. The focus of the partnership is the development of autonomous driving. Volkswagen Group China, Mobility Asia and JAC will pool their resources and collaborate on autonomous mobility services, including self-driving vehicles (robotaxis) and autonomous fleet management. In addition, the Smart City partnership includes areas such as ride railing or car sharing.

Around eight million people live in the city of Hefei, which aims to become a state-of-the-art smart city with the help of this partnership.

Leave a Reply