Audi and China's state-owned automaker SAIC Motor have confirmed they reached an agreement to partner on EV projects in the Chinese market.

Audi said on July 20 that it reached an agreement with SAIC that will allow the two companies to accelerate the electrification of their portfolios in China's fast-growing EV market. The two companies did not provide additional details regarding their partnership, but Audi is reportedly interested in using a platform owned by SAIC's premium EV brand IM Motors

The EV architecture supports both rear- and all-wheel drive, and is currently utilized by SAIC's IM Motors for the L7 sedan and LS7 SUV. Audi is rumored to plan using SAIC's EV platform for the production variants of the Activesphere, Urbansphere, Skysphere, and Grandsphere concepts.

Zu Sijie, SAIC's chief engineer, told reporters yesterday the automaker is deepening its cooperation with Audi, adding that licensing and joint development are options for future projects.

Audi's parent company Volkswagen Group, already has a joint venture with SAIC (SAIC-Volkswagen) that builds gasoline-powered cars in China.

Gallery: Audi urbansphere concept

The Ingolstadt-based automaker is under pressure to improve sales, especially in China, after its EV push has stalled because of delays in Volkswagen Group's software development. 

Audi's Q6 e-tron based on the Premium Platform Electric (PPE) has been delayed to 2024, and VW Group also cancelled Audi's Artemis project for a self-driving flagship EV. Furthermore, the Scalable Systems Platform (SSP) developed by VW Group has also been delayed by software issues.

As Bloomberg points out, Audi's decision to partner with SAIC Motor to develop electric vehicles marks a turning point in China's automotive industry from learning from foreign manufacturers to innovating its own tech. 

Volkswagen Group has used platforms from other automakers in the past, such as Ford's truck platform for the VW Amarok pickup, but never from a Chinese company.

The Audi-SAIC deal comes weeks after Audi announced that it would replace CEO Markus Duesmann with VW Group veteran Gernot Doellner, effective September 1, 2023. The new chief executive has to address challenges such as being slow to electrify and launching new models.

Audi was outsold by Tesla globally in the first quarter of the year and Audi's market share in China is shrinking on lack of EV models.

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