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VW and partner SAIC start building $2.5B Audi plant in China

BEIJING — Volkswagen AG's China joint venture with SAIC Motor Corp has started building a $2.5 billion new energy vehicle (NEV) plant in Shanghai, which will make VW's luxury Audi brand cars, a possible first for the venture. The new plant is a key step for Audi to diversify production of its cars in the world's largest car market from its long-standing local partner, China FAW Group Corp. This shift has been delayed amid resistance from local dealers. SAIC Volkswagen said the new plant would have an annual capacity to make 300,000 cars and begin production from 2020. Audi sold 481,387 vehicles in China from January to September this year. The announcement comes the same week Tesla secured a Shanghai location for a Gigafactory battery plant to serve the Chinese market. Audi unveiled the plan to bolster ties with SAIC in late 2016. Earlier this year, the Germany luxury carmaker bought a 1 percent stake in the SAIC Volkswagen venture, paving the way for the joint venture to produce and sell Audi cars. Volkswagen currently gets a larger proportion of the proceeds from the 50-50 tie-up with SAIC than from its 40 percent stake in the venture with FAW. SAIC Volkswagen said in a statement on Friday the plant would cost 17 billion yuan ($2.5 billion) and would make VW and Skoda models as well as Audi cars. It will help VW tap China's fast-growing market for NEVs, a category comprising electric battery cars and plug-in electric hybrid vehicles. ($1 = 6.9314 Chinese yuan renminbi) Reporting by Yilei Sun and Adam JourdanRelated Video: Image Credit: Reuters Green Plants/Manufacturing Audi Volkswagen Skoda Electric Hybrid

VW, Suzuki mulling rekindling relationship in face of legal battle

Volkswagen and Suzuki have been undergoing marriage counseling in a bid to avoid finalizing their nasty divorce. The blissful union has been troubled for some time, with Volkswagen claiming that it could affect operational decisions at Suzuki, and the Japanese brand's sniping and constant flirting with a certain Italian temptress causing rifts.
The matter first went to court in 2012, when Suzuki demanded VW get out, and leave its 19.9-percent stake in the Japanese brand in a box to the left. Now, Automotive News is reporting that the company will give the relationship one last shot, according to closed-door dealings between the two in London.
Still, it's understood that VW and Suzuki recognize the benefit of their alliance, and that it'd be in the best interests of the kids both parties to make things work. Spokespeople declined to comment to AN, but the newsmagazine spoke with Frank Biller, an analyst for LBBW in Stuttgart, who said, "Both companies stand to benefit if they can overcome the disagreements over leadership claims."

VW quite interested in solid-state batteries for EVs

Volkswagen is about to make a decision about which advanced battery technology the automaker will seriously investigate to give its electric vehicles more range. VW will decide by July if it will use solid-state batteries made by US-based QuantumScape Corp. in future EVs, according to Bloomberg News. Last year, VW bought a five-percent stake in QuantumScape, which was founded by ex-Stanford University researchers. The lure is that QuantumScape's solid-state batteries may provide a single-charge range of as long as 430 miles. That's more than three times the current range of the VW e-Golf electric vehicle the company recently started selling to the public and is substantially longer than the single-charge range of the Tesla Model S electric sedan. The batteries are also fireproof, making VW's potential decision one with an eye towards more vehicle safety. Solid-state battery technology, in which solid lithium electrodes are used instead of liquid electrodes such as those in lithium-ion batteries, are the subject of research at other automakers and suppliers as well. Toyota says they could be here by 2020. Recently, the cordless vacuum cleaner maker Dyson acquired a $15-million equity stake in Michigan-based battery maker Sakti3 with the idea of using the startup's solid-state batteries in its products. General Motors also has a minority stake in Sakti3, which was spun off from the University of Michigan.