Shanghai Auto Show 2025: Volkswagen struggling against the rise of BYD

At the Shanghai Auto Show 2025, the fallen king of European automobiles, Volkswagen, is seriously confronting a reality often ignored: the throne tolerates no weakness, especially against hungry local competitors boosted by electric power. While the German manufacturer once sought to conquer the Middle Empire as one devours fish and chips in a greasy spoon, it must now swallow the bitter pill of a BYD launched at full speed, blowing it off the top spot in the Chinese market. This encounter of titans has all the makings of a battle whose blows will not be painless, revealing the complexity of a sector shaken by the rise of national brands, green energy, and an industrial nationalism worthy of a Greek tragedy.

the meteoric rise of byd disrupts the chinese car market

BYD is no longer just the bold newcomer; it has become the captain of the ship on an ocean where Volkswagen is dangerously adrift. Last March, the Chinese giant sold 290,000 vehicles on its home soil, a thunderous increase of 11.5%. Meanwhile, Volkswagen, despite all its German rigor, faltered by selling only 221,000 units, with a notable decline of 5%. It looks like an old bourgeois shark being overtaken by a school of hungry piranhas... and it hurts.

Chinese nationalism, supported by a creeping voluntary electrification strategy, acts as a catalyst for BYD and its rivals. By taming the battery supply chain—the heart of the modern battle—local manufacturers are heavily arming themselves, while Volkswagen plays a supporting role. Yes, Volkswagen may have invested over 22 billion euros between 2015 and 2019 in China, but yesterday's enthusiasm has indeed transformed into palpable tension.

volkswagen: from historic pioneer to disoriented challenger

We will never forget the Volkswagen Santana, an iconic car that brought glory to the Chinese automotive industry starting in the 1980s. At one time, Volkswagen was the undisputed master, boldly dominating an entire expanding automotive empire. But today, its figures reflect a worrying decline, with a total of 644,100 vehicles sold in the first quarter, marking a plunge of 7%. Audi, Porsche, and even Mercedes-Benz must be wondering if they are doomed to play second fiddle on this changing stage.

To make matters worse, BYD did not wait for Volkswagen to roll up its sleeves: the brand is laying its stakes everywhere, with a famous 15% of the Chinese market compared to a meager 11.4% for the German giant. Geely, Renault, Peugeot, Nissan, and BMW are also slipping into this frantic race, but it is indeed the BYD-Volkswagen duo that polarizes attention. The preservation of this major source of cash flow for Volkswagen is thus a vital urgency concocted in an ultra-competitive and decidedly unforgiving context.

strategies and innovations: the battle to retain the chinese throne

Aware of the danger, Volkswagen is preparing a show-stopping move for the salon, showcasing seven world premieres. An agenda that smells of the awakening of large cylinders, ready to play in the big leagues with a product offensive promising more than 20 fully electric or plug-in hybrid models by 2027 and about thirty by 2030. Enough to try to stem the hemorrhage.

Even so, the cocktail of Chinese nationalism, energy battle, and logistical efficiency puts Volkswagen on the defensive. To prevent Tesla and other competitors from gliding smoothly on the electric wave, the German giant is even partnering with the world's leading battery producer, the Chinese CATL. Such irony spices up the saga of an empire that has lost some feathers but not its pride.

Source: www.challenges.fr

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