Volkswagen confirmed on May 29 what Reuters stated back on May 27. Reuters even got the day of the announcement right when it said Volkswagen would become the biggest shareholder of Guoxuan High-Tech Co Ltd. – a Tier 2 battery maker. It also hit the nail on the head about the investment details on JAC Motors parent company, Anhui Jianghuai Automobile Group Holding.

Guoxuan – also known as Gotian – saw 26 percent of its shares end up in Volkswagen’s hands in exchange for €1.1 billion. Reuters said the German automaker would buy 27 percent of the shares, but the number is pretty close to the final one. With this number of shares, Volkswagen became the largest single shareholder of Guoxuan. This battery supplier also works with sourcing, development, and recycling, according to the German company’s press release.

More Volkswagen EV News:

According to Benchmark Mineral Intelligence, one of the critical aspects of Volkswagen’s interest in Guoxuan is its expansion into high nickel cathode cells. The Chinese battery manufacturer also has an installed capacity of 13 GWh and will add 16 GWh to that with a new megafactory in Hefei. 

As the main shareholder of a prominent battery manufacturer, Volkswagen may ensure a steady supply of batteries to its MEB vehicles. Guoxuan will soon become a certified supplier for that electric platform. Apart from that, the Chinese battery producer also has about 5 percent of the LFP battery market in China. In the future, it can undoubtedly supply Volkswagen with some of these batteries for cheaper electric vehicles, such as the ones produced by JAC Volkswagen and sold under the SOL brand.


After a €1 billion investment, VW increased its share at JAC Volkswagen to 75 percent, becoming the controlling partner of the electric car company. As Reuters stated, that money also allowed the German automaker to buy 50 percent of the shares of Anhui Jianghuai Automobile Group Holding, which controls JAC Motors.

Both deals are still “subject to customary regulatory approvals,” but Volkswagen expects them to be finalized by the end of 2020. When that happens, Volkswagen will have proved that, just like legacy automakers need to produce their own engines, electric car manufacturers have to ensure they will have battery packs for their vehicles. Building them may be the best way to take that for granted.

Hide press release Show press release

Volkswagen intensifies e-mobility activities in China

  • Volkswagen increases stake in JAC Volkswagen joint venture to 75 percent and acquires 50 percent of parent company JAG
  • Additionally, Volkswagen acquires 26 percent of Gotion High-Tech, becoming largest shareholder
  • Total investment of around €2 billion
  • CEO Dr. Herbert Diess: “Together with strong and reliable partners, Volkswagen is strengthening its electrification strategy in China.”

Today, Volkswagen has initiated the next chapter for its business in China. Volkswagen plans to increase its share in JAC Volkswagen, its joint venture for e-mobility. Around €1 billion is to be invested. This amount includes the acquisition of 50 percent of JAG, the parent company of the Volkswagen partner JAC, and an increase in the stake in JAC Volkswagen from 50 to 75 percent. By gaining management control, Volkswagen is paving the way for more electric models and infrastructure. Furthermore, Volkswagen will acquire a 26 percent stake in battery manufacturer Gotion High-Tech Co., Ltd. for around €1 billion, becoming the company’s largest shareholder.

Dr. Herbert Diess, CEO of Volkswagen AG, said: “Together with strong and reliable partners, Volkswagen is strengthening its electrification strategy in China. The electric cars segment is growing rapidly and offers a great deal of potential for JAC Volkswagen. We are actively driving forward the development of battery cells in China through our strategic investment in Gotion.”

Dr. Stephan Wöllenstein, CEO of Volkswagen Group China, said: “I am delighted with this strategic milestone in our mutual and trusted relations as Volkswagen takes a strategic role in a state-owned company for the first time, as well as investing direct in a Chinese battery supplier. These investments shape the character of Volkswagen in China, making it a more localized, more sustainability-focused mobility company. By opening up the market, China is giving Volkswagen new business opportunities.” Volkswagen Group China has already outlined its route to becoming a net carbon-neutral company. In 2025, around 1.5 million NEVs are planned for delivery to customers across the country. China is the world´s biggest market for e-mobility.

Transformation of JAC Volkswagen through capital increase

By strengthening its position and advancing the JAC Volkswagen joint venture through a capital increase, Volkswagen is taking the next step in its Chinese electrification strategy. Letters of intent were co-signed by Volkswagen (China) Investment Co. Ltd. and the government of Anhui province, which foresee Volkswagen raising its stake from 50% to 75% within the JAC Volkswagen joint venture via a capital increase. To make this possible, Volkswagen will also be investing in the Anhui government-owned entity JAG, the parent company of JAC. The parties intend to close the deal amounting to €1 billion by the end of the year, subject to customary regulatory approvals.

Founded in 2017, the JAC Volkswagen joint venture is an all-electric company which develops, produces and sells NEVs. A portfolio expansion of up to 5 additional BEV models by 2025 is planned, as well as building a full-scale e-model factory and finishing the R&D center in Hefei.

Securing future battery supply to meet demand will requireincreased localization

Volkswagen has found a further partner to secure future demand for batteries for its Chinese e-models. With the signing of binding agreements, Volkswagen (China) Investment Co. Ltd. will become the largest shareholder in Gotion, with 26 percent of the shares, through a buy-in of around €1.1 billion. Volkswagen is the first global automaker to invest direct in a Chinese battery supplier. It is planned to complete the deal by the end of 2020, subject to customary regulatory approvals.

The partnership is an opportunity for Volkswagen to achieve deeper know-how in the field of batteries. Gotion maintains various current and future projects over the entire battery value chain from sourcing, development and production to recycling. Gotion is in the process of becoming a certified Volkswagen Group battery supplier in China, including supplies for local MEB vehicles. The MEB is the new modular electric vehicle platform of the Volkswagen Group.

The deal will not affect ongoing contracts with other battery suppliers.

Got a tip for us? Email: