Key points
- Audi and SAIC Motor have reached an agreement to partner on EV projects in China.
- The two companies will work together to accelerate the electrification of their portfolios in China’s fast-growing EV market.
- Audi is reportedly interested in using a platform owned by SAIC’s premium EV brand IM Motors.
- The deal comes weeks after Audi announced that it would replace CEO Markus Duesmann with VW Group veteran Gernot Doellner, effective September 1, 2023.
- Audi was outsold by Tesla globally in the first quarter of the year and Audi’s market share in China is shrinking on lack of EV models.
- This partnership is a significant step for Audi as it looks to catch up to Tesla and other EV leaders.
- It also marks a turning point in China’s automotive industry as it moves from learning from foreign manufacturers to innovating its own tech.
Details of partnership
Audi and China’s state-owned automaker SAIC Motor have formed a partnership to collaborate on electric vehicle (EV) projects in the Chinese market. The agreement aims to accelerate the electrification efforts of both companies in China’s fast-growing EV market.
While specific details of the partnership were not disclosed in the news, it is mentioned that Audi is interested in using SAIC’s premium EV brand IM Motors’ platform. This platform supports both rear- and all-wheel drive and is currently used by SAIC for the L7 sedan and LS7 SUV. Audi reportedly plans to use this platform for the production variants of its Activesphere, Urbansphere, Skysphere, and Grandsphere EV concepts.
Joint development
The news also highlights that SAIC’s chief engineer, Zu Sijie, stated the automaker’s intention to deepen cooperation with Audi and considers licensing and joint development as options for future projects.
It is noted that Audi’s parent company, Volkswagen Group, already has a joint venture with SAIC (SAIC-Volkswagen) that focuses on producing gasoline-powered cars in China.
EV Push
Audi faces challenges in the Chinese market, especially with its EV push experiencing delays due to issues with Volkswagen Group’s software development. Several EV projects, including the Q6 e-tron based on the Premium Platform Electric (PPE) and the Artemis project for a self-driving flagship EV, have been delayed.
By partnering with SAIC to develop EVs, Audi’s decision represents a turning point in China’s automotive industry, transitioning from learning from foreign manufacturers to innovating its own technology.
New leadership
The news also mentions a recent leadership change within Audi, as CEO Markus Duesmann is set to be replaced by VW Group veteran Gernot Doellner on September 1, 2023. The new CEO will need to address challenges such as slow electrification and launching new models. Audi’s market share in China has been shrinking due to a lack of competitive EV models, and it has also been outsold by Tesla globally in the first quarter of the year.
The partnership between Audi and SAIC Motor to collaborate on electric vehicle projects in the Chinese market offers several benefits for both companies:
- Access to a Growing EV Market: China is one of the largest and fastest-growing markets for electric vehicles. By partnering with SAIC, Audi gains access to a well-established local player with a strong presence in the Chinese market. This allows Audi to tap into the growing demand for EVs in China and expand its market share in the region.
- Accelerated Electrification Efforts: Audi has been facing delays in its EV push due to software development issues within the Volkswagen Group. By leveraging SAIC’s existing electric vehicle platform, Audi can speed up its electrification efforts and bring new EV models to the market more quickly. This partnership allows Audi to remain competitive in the rapidly evolving EV landscape.
- Cost and Resource Sharing: Collaborating with SAIC enables Audi to share development costs and resources related to electric vehicle technology. This can help both companies reduce expenses and optimize their research and development efforts, leading to more cost-effective and innovative EV solutions.
Benefits continue
- Leveraging SAIC’s EV Platform: SAIC’s premium EV brand IM Motors has a proven electric vehicle architecture that supports both rear- and all-wheel drive. By utilizing this platform, Audi can leverage SAIC’s expertise and experience in electric vehicle technology, potentially leading to enhanced performance and efficiency in their EV offerings.
- Enhancing Brand Image: As the global automotive industry shifts towards sustainable mobility solutions, being active in the Chinese EV market and producing environmentally friendly vehicles can improve Audi’s brand image and reputation. It demonstrates a commitment to sustainability and showcases Audi’s efforts to be at the forefront of EV technology.
- Learning from Local Market Expertise: By partnering with a prominent Chinese automaker like SAIC, Audi can gain valuable insights into the local market’s preferences, regulatory landscape, and consumer behaviour. This knowledge can help Audi tailor its EV offerings to better meet the needs and expectations of Chinese consumers.
- Strengthening SAIC’s Position: For SAIC Motor, a partnership with a well-established international brand like Audi can strengthen its position in the global automotive market. Collaborating with Audi on EV projects allows SAIC to showcase its capabilities in EV technology and innovation, potentially leading to more opportunities for international collaborations and partnerships in the future.
Conclusion
Audi and China’s SAIC Motor have reached a significant agreement to collaborate on electric vehicle projects in the Chinese market. The partnership aims to accelerate the electrification of both companies’ portfolios and take advantage of SAIC’s premium EV brand IM Motors’ platform, which supports rear- and all-wheel drive.
The decision to partner with SAIC marks a turning point in China’s automotive industry, as it represents a shift from learning from foreign manufacturers to innovating its own technology. This move also comes as Audi faces challenges in the Chinese market, including delays in its EV push due to software development issues within Volkswagen Group.
By joining forces, Audi and SAIC are positioning themselves to strengthen their presence in China’s fast-growing EV market, where competition is intensifying. The partnership allows Audi to tap into SAIC’s established platform and expertise, potentially helping them to expedite the production of various EV models based on their concepts.
