Volkswagen subsidiary ceases operations after years of cooperation
Beijing, July 8 -- Jiangxi Laiyuan Advanced Manufacturing Technology Co., Ltd. announced on Monday that it will dissolve at the end of the year's six-month mark following a strategic departure by parent Volkswagen Group.
According to a filing with the China Enterprise Credit Information Publicity System website, the company was dissolved due to decision to dissolve and is effective from June 10 to July 24. Jiangxi Laiyuan Advanced Manufacturing Technology Co., Ltd., previously established in March 2021 with registered capital of 5.1 billion CNY and listed shareholders Volkswagen Group (50% owned) and Anhui Jianghuai Automobile Co., Ltd. (50%), is a company focused on research development.
The partnership between the two companies began in 2016, when VW agreed to a billion-yuan deal with Jianghuai Automobile to establish ES8, ES6, EC6 production lines for the company's own car brand. The Volkswagen subsidiary then increased its stake in Jiangxi Laiyuan Advanced Manufacturing Technology Co., Ltd., creating Jiangxi Laiyuan Advanced Manufacturing Technology Co., Ltd. to manufacture ES7, EC7, ET5 vehicle chassis and engine parts.
However, after a year, Jianghuai Automobile Company announced its intention to restructure assets from three factories; the new project will be sold on an open auction platform at a final purchase price of 4.498 billion yuan for a total value of 31.58 billion yuan. In that process, Volkswagen Group (China) Auto Technology Co. Ltd. acquired most assets for both packages and obtained full production licenses, meaning the company is independent now.
Notably, the majority asset was sold from two manufacturing factories, which were originally under VW’s production lines. Hence there are two VW manufacturing sites in operation in China.
In December 2024, Volkswagen Group announced that it would rebrand all types of cars made at these two locations under its own brand. The vehicles will no longer carry the logo of Jianghuai Automobile. However, this does not affect production capacity and manufacturing systems currently used by VW.
