Volkswagen has suspended production at two of its German electric vehicle factories, reflecting a downturn in demand and growing pressure from Chinese competitors such as BYD, whose European sales have surged.
The automaker halted operations at its Transparent Factory in Dresden and its Zwickau plant in Saxony for a week beginning October 6. Both facilities focus on electric vehicle models built on Volkswagen’s Modular Electric Drive Matrix (MEB) platform, including the Audi Q4 e-tron. The company cited slower electric vehicle sales as the reason for the pause.
Similar measures are taking place at other locations. The Emden plant, where the ID.4 and ID.7 models are assembled, has reduced employee hours, while management is negotiating several-day production breaks. In Osnabrück, the factory will close one day per week until the end of 2025.
Despite the slowdown in its electric lineup, demand for combustion engine models remains strong. At Volkswagen’s main Wolfsburg facility, extra weekend shifts are planned through December to keep up with orders for popular models such as the Golf, Tiguan, and Tayron. Production has reportedly been increased to meet a growing backlog.
Volkswagen faces intensifying pressure from both sides of the industry. Chinese carmakers like BYD and MG have gained a foothold in Europe with lower prices and well-equipped models, while brands such as Tesla and Hyundai attract buyers with faster charging systems and better software. Analysts say Volkswagen’s current EV platform and corporate structure have lagged behind competitors in agility and innovation.
Chief Executive Oliver Blume described the past year as a period of “setting the course,” emphasizing the company’s “Accelerate” strategy to regain momentum. Volkswagen plans to introduce a more efficient SSP platform, develop EVs priced around €25,000, and expand in-house battery production through its PowerCo subsidiary.
Industry analysts see the temporary shutdowns in Zwickau and Emden as a warning that Volkswagen must speed up reforms to sustain its position in a rapidly evolving electric vehicle market.
Source: Reuters