Volkswagen Group Investing ~€1B in Vehicles and Components, Purchasing Center in Hefei; Shortening Development Time by 30%

The Volkswagen Group is investing around €1 billion in a new development, innovation, and procurement center for fully connected intelligent electric vehicles in the southern Chinese city of Hefei.

The Group made the announcement at the Shanghai Auto Show. The new company, with the project name ‘100%TechCo’, combines vehicles and components R&D teams with purchasing. This will leverage synergies in the development process and integrate state-of-the-art local technologies into product development at an early stage.

The aim is to align the Group’s vehicles even more quickly with the wishes of Chinese customers and to achieve shorter time to market. With the launch of 100%TechCo in 2024, the development times of new products and technologies will be gradually shortened by around 30%.

For R&D activities, 100%TechCo will not only bundle research and development for vehicles and components in China, for China, but also merge procurement into a joint unit. To this end, local suppliers will be involved in the early stages of product development in order to integrate the latest technologies and application concepts into new products. In addition, the new company will more closely integrate the development projects of all of the Volkswagen Group's joint ventures in China – SAIC, Volkswagen, FAW-VW, and Volkswagen Anhui.

The new unit is expected to launch in early 2024 and will comprise more than 2,000 employees from procurement and R&D. The CEO will be Marcus Hafkemeyer, Chief Technology Officer of Volkswagen Group China.

With 100%TechCo, we are opening a new chapter in our cooperation with our joint venture partners in Changchun, Shanghai, and Hefei, as well as the Group's brands. We are fostering seamless collaboration to bring customized products to the Chinese market even faster and more efficiently. In a first step, 100%TechCo will steer the development of the models of the Volkswagen Anhui joint venture based on the MEB platform and will be responsible for the development of China-specific platform requirements and modules with a focus on electric mobility.

—Marcus Hafkemeyer

The company is already expected to play a major role in the development of a future Volkswagen brand model to be launched in 2024.