The China Conundrum
China, once seen as a potential solution to Volkswagen's problems, is proving to be equally challenging:
Joint Venture Woes: Volkswagen and its Chinese partner, SAIC Motor, are shutting down one of the world's largest car factories, capable of producing 2.1 million cars annually, due to declining sales of combustion-powered vehicles and the rising popularity of EVs.
Capacity Utilization Issues: The joint venture's factories are only operating at 58% of their total capacity of 2.1 million vehicles, making them financially unviable.
Skoda Brand Review: Volkswagen is conducting a strategy review of its Skoda brand due to dropping sales, with the possibility of the brand exiting the Chinese market entirely.