Volkswagen CEO Says China Experience Offers Lessons for Germany, Admits Fierce Competition in China

Volkswagen CEO Oliver Blume recently stated that Germany should learn from China’s systematic industrial planning and efficient execution. He noted that China’s clear five-year planning goals, optimized industrial structure, and strong corporate implementation capabilities are worthy of emulation. Blume also acknowledged that Volkswagen faces over 150 competitors in China, where the market is highly innovative and intensely competitive. Despite rising global orders, Volkswagen will press ahead with restructuring and set clear cost targets for all its plants—including those in Germany, Europe, and China—to avoid overcapacity. He added that high production costs and cumbersome regulations in Germany have made the traditional “German R&D, manufacturing, and export” model unsustainable. Due to tariffs, heavy investments in electrification, and competition from Chinese automakers, Volkswagen expects its operating profit margin this year to fall as low as 4%.