Volkswagen Plans to Moving into Smaller Cities in China

VolkswagenVolkswagenGermany, 1938 > present98 models
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plans to dominate the Chinese market by 2018 and to increase sales it plans to open showrooms in smaller cities to lure more buyers. Small cities are projected to take 60% of new car sales by 2020, compared to 40% currently. 

For instance, it will add dealers to the Gansu province that has a per capita GDP of about $4,100. It is also far away from the country's east coast where China has a higher per capita GDP and where Volkswagen already dominates. 

"Volkswagen's early entry into China meant that our outlets focused on bigger, developed cities. Now, we have to expand beyond them," said Soh Weiming, VW China's executive vice president.

While Chinese growth is slowing, it is still a massive car market, and VW Group brands already control about 20% of the country's car sales. General MotorsGMUnited States of America, 1998 > present8 models
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is in a distant second place with 9.9% market share, and HyundaiHyundaiRepublic of Korea, 1967 > present79 models
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has 9.7% of the market.

Volkswagen plans to invest €9.8 billion in China through 2015, and GM plans to invest roughly half as much over the same period. It hopes the investment will help it conquer more of the Chinese market. 

Source: Automotive News Europe