Volkswagen bet on Xpeng to save its China business. It's not going to plan
Volkswagen's ID. UNYX 08 sold an average of 267 vehicles a month from April through August, versus an initial target of 3,622 monthly sales this year. Volkswagen cut its 2026 sales projection for the model by more than 60% and is advertising it at a 17% discount.
1. Weak debut in China
The ID. UNYX 08, the first product from Volkswagen's partnership with Xpeng, averaged 267 monthly sales between its April launch and August, ThinkerCar data show. Volkswagen had initially targeted 3,622 monthly sales this year, according to company planning documents. The vehicle launched at about $34,260, while similarly priced Chinese rivals offered features such as advanced sensors and fast charging.
2. Targets cut
Volkswagen initially projected sales of 32,600 UNYX 08s through the end of 2026 and 70,400 in 2027. Early this year, it cut its 2026 projection by more than 60% to 12,300, while forecasting 64,000 sales in 2027. The company has recently advertised the vehicle at a 17% discount from its launch price.
3. China business under pressure
Volkswagen's share of China's passenger-car market fell from one in five vehicles sold in 2019 to 10% in the first eight months of this year, according to the China Passenger Car Association. Volkswagen China CEO Ralf Brandstaetter warned staff that the company must urgently align production capacity with market realities, as he expected China's passenger-car market to shrink 20% this year.
