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

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

“Presently, there are greater than 120 automobile makers inside the [electric vehicle] market, and about 150 new fashions shall be launched in 2023. Intense market competitors and excessive battery costs make them face extreme financial stress. 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 latest capital funding.

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“We face a scenario the place the market is overheating. Consolidation of the enjoying area is in full swing,” the chief added. He was particularly crucial of the discounting of EVs in China.

“The fierce competitors has led to deep value reductions in latest months. It will in the end hurt the pursuits of shoppers. They are going to now not be capable of get companies from retired manufacturers, or they’ll see a big value reduce 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 careworn 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 an important.”

“We won’t have interaction in unhealthy market competitors with a view to obtain short-term supply development,” Brandstaetter stated taking one other jab at Tesla, which has reduce costs many instances this 12 months to extend gross sales.

The chief additionally famous that Volkswagen Group wouldn’t abandon the interior combustion engine automobile 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 reworking petrol fashions to plug-in hybrids.”