NIO (NIO) eyes buying Volkswagen plant in historic market shake up

China’s NIO (NIO) is considering buying Volkswagen’s Audi plant in Brussels. Volkswagen’s plant is at risk of being shut down, and NIO wants to take advantage as the market shifts to EVs.

NIO in talks to buy Volkswagen Brussels plant

Volkswagen may close its first plant in Germany ever. Its Audi Brussels factory is also at risk. The last time the company closed a facility was back in 1988 in Westmoreland, Pennsylvania.

However, VW is facing an overcapacity crisis amid sluggish EV sales and a slew of new competitively priced electric cars from China.

CEO Oliver Blume warned that Germany’s competitive advantage is at risk as the industry shifts to electric vehicles. Volkswagen has already canceled plans for a new EV facility and delayed key model launches as it falls further behind Chinese automakers.

According to a Belgian media report, China’s NIO is in talks to buy Volkswagen’s plant in Brussels.

The report from De Tijd claims NIO representatives recently visited the plant and are already working on a bid. NIO needs to submit its offer to VW by next Monday at the latest.

Volkswagen plans to stop building cars at the facility after the last Audi Q8 e-tron rolls off the production line next year. If the plant closes, the nearly 3,000 workers will lose their jobs.

NIO already sells vehicles in Germany, Norway, the Netherlands, Sweden, and Denmark. Although it doesn’t sell cars in Belgium yet, NIO plans to launch there soon.

Although NIO faces an additional 20.8% tariff on imports to the EU, the Chinese EV maker is committed to expanding in the region.

Electrek’s Take

NIO buying out Volkswagen’s Brussels plant would be symbolic of the market’s shift to EVs. European automakers, including VW, are facing stiff competition from China.

Even with tariffs, several Chinese EVs are expected to still be cheaper than their European rivals.

Although NIO is known for its “smart electric vehicles,” it’s launching new lower-cost models. Its new electric SUV, the Onvo L60, is widely viewed as a true Tesla Model Y Challenger. Starting at around $30,000 in China, NIO’s new electric SUV undercuts the Model Y by about $4,000 (30,000 yuan).

NIO plans to launch the competitively priced electric SUV globally later this year. Next year, the company will follow up with its new Firefly EV, which will launch in Europe for under $32,000 (30,000 Euro).

Meanwhile, Volkswagen’s struggles are not limited to Europe. The company is also facing a plant closure in China with its joint venture partner, SAIC.

Source: CnEVPost