Volkswagen plans farewell to legendary Santana model in China -Breaking
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© Reuters. FILE PHOTO – A Chinese commuter passes an advertisement for Volkswagen Santana Conqueror Shanghai on July 12, 2004. REUTERS/Claro Cortes IVBEIJING, Reuters – Volkswagen (DE) will stop producing Santana cars China. This is after more than three decades of making the first Chinese-made car that was a symbol for China’s growing middle class and helped to fuel its popularity.
Volkswagen AG (OTC 🙂 will cease production of Skoda Rapid, Santana, and current Tharu SUVs at its Yizheng plant, according to government documents.
The main China factory for Santanas is located in this plant, which can manufacture up to 224,000.
Volkswagen didn’t directly address its plans for Santana, but stated in a statement that it was responding to Reuters consumers have shifted from sedans towards SUVs.
According to the company, “Customer preference is gradually shifting away from notchback ICE [NYSE:]] (internal combustion engine model) models toward BEV (battery-electric vehicle) and SUV models.”
In China, Santana production began in 1985. Volkswagen claimed that more than 6,000,000 Santanas had been sold to Chinese customers. It wasn’t clear if Volkswagen would still make Santanas for other markets.
As China’s economy boomed in the 1990s, the affordable sedans became status symbols and helped Volkswagen enter the Chinese market.
Last year, Volkswagen in China sold 3.85 Million vehicles. This was more than General Motors Co (NYSE):. Its shift to popular and lucrative SUV models is partly responsible for this success.
The competition in the market for family cars has increased with more foreign competitors and Chinese companies entering the scene. This puts pressure on established foreign manufacturers.
SAIC-Volkswagen saw a decrease of 18% in vehicle sales during the first ten months of 2011. Hyundai Motor and other companies like it. Renault (PA:), Suzuki Motor and Toyota Motor have closed plants, exited joint ventures and quit the Chinese marketplace entirely.
The document states that the Yizheng factory would instead make Santanas Rapids and Santanas. The arrangements will be finalized in 2023. Volkswagen also has joint ventures in place with JAC and FAW Group. The ventures all work together to build new plant for electric cars.
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