Sales dipped for the first time since 2005 as VW opens its 20th plant in China
VW to keep up production Image: Dave Humphreys |
The German automaker posted its first decline in deliveries in a decade in the first half of 2015, as a sluggish economy caused overall sales to lag.
VW posted a 3.9% drop to 1.74m vehicles in H1, as affluent customers move away from sedans and towards larger SUVs. Sales also dropeed 6.7% year-on-year during the same period.
Cash incentives, discounts and financial aid for dealers have all failed to stem sliding sales, which are also due in part to shifting consumer tastes.
Would-be sedan purchasers are opting towards SUVS, while a campaign against graft and conspicous consumption has slowed sales of VW's luxury Audi and Porsche models.
Despite the fall, the carmaker is continuing to add production and has recently opened its 20th facility - in Changsha, Hunan province. The Group has also revised its pledge to produce 4m cars in China by 2018 to 5m cars by 2019.
Most Chinese factories are working overtime to cater for demand, according to VW, and are in operation up to 300 days a year. With the addition of more capcity, they will be able to operate at normalised levels of around 270 days per year.