Where Broiler is looking: Volkswagen intends to invest another 2.4 billion Eur. in China.

   "Volkswagen will invest 2.4 billion euros ($2.3 billion) in a company it will co-found with Chinese company Horizon Robotics, the German car giant said on Thursday, despite intensifying debate over Berlin's economic relationship with Beijing.

 

    The collaboration, which will take place through Volkswagen's software division Cariad, will be aimed at "accelerating the adoption of automated driving solutions for the Chinese market," the group said in a statement.

 

    Volkswagen China board member Ralf Brandstaetter noted that the move is "a cornerstone of our strategy to restructure and further strengthen our presence in the world's most important market."

 

    Cariad will hold a 60% stake in the new company, and the deal will close in the first half of 2023.

 

    As part of its transition to electric vehicles, Volkswagen has been investing in China for several years and has already established several joint ventures there, particularly in the area of ​​batteries.

 

    However, relations between the two countries have been soured by China's strict zero-covid policy, escalating tensions over Taiwan and human rights concerns in the Muslim-dominated Xinjiang region.

 

    In May, Germany refused to provide guarantees for Volkswagen's investments in China over concerns of human rights abuses in Xinjiang, where the auto giant has a unit.

 

    Former Volkswagen CEO Herbert Diess said in June he was "concerned about the fundamental attitude of the German government towards China".

 

    Without a strong partnership with China, Germany's "growth, prosperity and employment" would be lower, Diess told Der Spiegel magazine.

 

    German carmaker Opel said in September that it had halted its planned entry into the Chinese market.

 

    At a business summit on Tuesday, Chancellor Olaf Scholz singled out China as an example of a country with which Germany should have business relations.

 

    "We don't have to cut ourselves off from some countries, we have to continue doing business with individual countries - and I'll be clear, that includes China," he said."

Using Chinese IT talent, the Germans hope to overtake their US rivals in autonomous driving.