Volkswagen Group China CEO Ralf Brandstaetter, who beforehand served as CEO of the Volkswagen Passenger Vehicles model, has warned that the electrical automotive market is “overheating.” 

Talking on the 2023 China Vehicle Discussion board hosted by the China Affiliation of Vehicle Producers in Shanghai, Brandstaetter stated that top capital funding and discounting “will in the end hurt the pursuits of shoppers,” based on Autocar.

“At present, there are greater than 120 automotive makers throughout the [electric vehicle] market, and about 150 new fashions might be launched in 2023. Intense market competitors and excessive battery costs make them face extreme financial strain. Quick-term gross sales success requires extraordinarily excessive capital funding.”

He additionally famous that many EV startups face a monetary squeeze and are exiting or about to exit the market, or are in pressing want of recent capital funding.

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“We face a state of affairs the place the market is overheating. Consolidation of the taking part in discipline is in full swing,” the chief added. He was particularly important of the discounting of EVs in China.

“The fierce competitors has led to deep value reductions in latest months. This may in the end hurt the pursuits of shoppers. They are going to not be capable to get companies from retired manufacturers, or they are going to see a big value minimize on the fashions they purchase.”

The feedback are clearly a reference to Tesla, which has began an EV value warfare in China in late 2022 – and never solely in China. Brandstaetter harassed the Volkswagen Group wouldn’t chase gross sales and development in China’s EV market in any respect prices as “the profitability of the enterprise is a very powerful.”

“We won’t interact in unhealthy market competitors so as to obtain short-term supply development,” Brandstaetter stated taking one other jab at Tesla, which has minimize costs many instances this yr to extend gross sales.

The chief additionally famous that Volkswagen Group wouldn’t abandon the inner combustion engine automotive market in China regardless of slowing gross sales. He stated the carmaker would launch a complete of 17 new ICE fashions in China by 2030, along with selling the event of hybrid know-how and “progressively remodeling petrol fashions to plug-in hybrids.”