Volkswagen may sell China-built cars in Europe as margins fall. The company faces pressure from rivals and global overcapacity. These plans depend heavily on tariffs, logistics, and cost factors. Margin pressure has a way of softening old certainties, and Volkswagen’s are looking softer by the quarter. The German giant has revealed it could begin selling Chinese-built cars in Europe, with the possibility of eventually assembling some of them in Germany. No doubt, it would be a controversial move. But it could also be the difference between a healthy business and the one VW currently runs, which limps along on margins of just 4.3 percent. Like several other legacy brands, Volkswagen has been struggling to keep pace with new rivals in China. At the same time, it’s dealing with international tariffs and severe overcapacity. The company recently confirmed its overall global capacity will be reduced by an additional 1 million units, bringing it to around 11 million. It has not yet specified where those production cuts will occur. Read: VW Ruled China For 25 Years, Now Young Buyers Call It Their Parents’ Car During the company’s most recent earnings call with investors and analysts, CEO Oliver Blume said VW expects more competition from Chinese brands in the coming years. As a result, it could be pushed to sell China-built cars in Europe. “What we will check is what own China products could fit for the European market, especially in segments where we are not present right now,” Blume said. He added that any such move would depend on tariffs, logistics costs, and other factors, meaning no final decision has been made. Other Regions Will Come First VW ID. Unyx 08 “We will decide, depending on the success we have in China, which model would fit in Europe, especially in segments where we are not present with our current portfolio in Europe. Step by step. It’s too early and we haven’t kicked off the process and we haven’t taken a decision,” Blume added. Later on during the call, Blume reiterated that it’s prioritizing selling vehicles it makes in China to markets including Asia-Pacific, the Middle East, India, South America, and Africa, noting that Europe is only “maybe a step for the upcoming years, but not decided.” VW recently unveiled the ID. Aura T6 SUV, developed and produced with joint venture partner FAW, along with the ID. Unyx 09 sedan created in partnership with Xpeng at the Beijing Auto Show. Models like these could resonate in Europe, thanks to strong technology offerings and competitive EV performance. VW ID. Era 9X
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