Volkswagen Group unveiled VEGA, a package of electric-car platforms, electronics and driver-assistance technology developed in China, on Wednesday and said it would take the technology to other markets, starting with South America by 2030.
The launch at the group’s first China Tech Day in Hefei marks a shift from Volkswagen’s “In China, for China” strategy, under which its Chinese operations developed cars only for the local market, to what it calls “In China, Beyond China.”
“China is a key innovation engine for the Volkswagen Group — and increasingly a product and tech hub for our global markets,” the Group’s CEO Oliver Blume said.
Volkswagen describes VEGA, named after one of the brightest stars in the northern sky, as the first fully in-house technology stack developed in China by a foreign carmaker, according to Chinese media reports.
“Our locally developed integrated technology matrix is the tangible result of this transformation,” said Ralf Brandstätter, the Volkswagen AG board member responsible for China and head of Volkswagen Group China, according to Chinese media reports, adding that it would open new business opportunities beyond China.
What VEGA includes
VEGA combines three pieces of technology developed by Volkswagen’s teams in China.
The first is two vehicle platforms. The Compact Main Platform (CMP), for mainstream compact models, supports battery-electric and plug-in hybrid powertrains, with a claimed range of more than 600 kilometers (373 miles) on China’s CLTC test cycle and energy use of about 11 kWh per 100 kilometers in its most efficient version.
CMP cars have a 54:46 front-to-rear weight distribution and a multi-link rear suspension, and can charge from 30% to 80% in 25 minutes.
The China Scalable Platform (CSP), for full-size and flagship models, supports battery-electric and extended-range powertrains. Volkswagen is targeting more than 800 kilometers (497 miles) of electric range with consumption below 13 kWh per 100 kilometers, and more than 1,500 kilometers (932 miles) of combined range for extended-range versions.
CSP models will have a turning radius below 5.5 meters (18 feet) and accelerate from 0 to 100 km/h (62 mph) in 4.1 seconds.
CSP uses an architecture above 850 volts and can charge from 10% to 80% in as little as 13 minutes, the report said. Volkswagen plans 10 CSP-based products, with the first new model around 2028.
On both platforms, the motor cuts power within 5 milliseconds of a severe crash and the high-voltage battery drops to a safe voltage within 5 seconds, against 60 seconds under China’s national standard, Volkswagen said. It is targeting five-star C-NCAP ratings and top marks in all C-IASI safety categories.
The second piece is the China Electronic Architecture (CEA), which Volkswagen presented on Wednesday as self-developed. Volkswagen described it as jointly developed with Xpeng when it signed the master agreement in July 2024. The collaboration had ended.
CEA cuts the number of control units by about 30%. It is used in five locally built electric models this year, the ID. UNYX 06, ID. UNYX 07, ID. ERA 5X, ID. AURA T6 and ID. AURA L5, and will extend to plug-in hybrid and combustion models in 2027, when a first major upgrade will merge cockpit and driver-assistance computing in preparation for Level 3.
A version 3.0, planned by 2029, will enable AI agents across vehicle systems and support Level 4 development. Major software feature updates are planned about every three months, with a full architecture upgrade every two years.
The third piece is Hyper Sense 8, a driver-assistance system developed by Carizon, Volkswagen’s intelligent-driving center in China, that handles navigation on city roads and highways and automated parking. It will come on seven new electrified models from the group’s three Chinese joint ventures.
Level 3 by 2027
Volkswagen said on Monday it had received a permit to test Level 3 automated driving on public roads in Hefei, and that testing had begun, allowing tests but not sales of Level 3 cars. It is targeting Level 3 readiness in 2027.
“Technological progress must never come at the expense of safety,” Ralf Brandstätter, who heads Volkswagen Group China, said in that statement.
The group’s AI world model, GAIA 2.0, runs daily safety simulations equivalent to 5 million kilometers (3.1 million miles) of driving, and Volkswagen is developing its own chip, the C7H, designed to support Level 4 driving, the company said.
AI tools have cut the time needed to test some software functions from two to three days to two to three hours, up to 36 times faster, and the time to diagnose a software problem from about two weeks to 20 minutes, Volkswagen said, according to IT Home. AI agents have run on all CEA vehicles since the third quarter.
FAW-Volkswagen’s ID. AURA L5, built on CMP with CEA and Carizon’s driver assistance, made its first public appearance at the event, fitted with a Horizon Robotics Journey 6H chip and a 192-line LiDAR.
Volkswagen’s research and development company in Hefei employs more than 3,000 local engineers, making it the group’s largest research base outside Germany, Ifeng reported. Developing locally can cut development time by up to 30%, Volkswagen said, according to Reuters.
Exports first, technology later
China-built Volkswagen and Jetta cars are already exported to the Middle East, Uzbekistan, Kazakhstan and sub-Saharan Africa. Volkswagen plans to add Mexico, Egypt and Vietnam by the end of 2026, bringing the total to seven markets.
At a later stage, they aim to expand into Southeast Asia, South America and more of Africa.
South America will be the first region to use China-developed technology in locally built models, before 2030. Volkswagen also plans to extend the CMP platform and CEA architecture to markets such as South Africa.
South America was chosen because it is cost-sensitive and Chinese carmakers are already strong there, Frank Han, CEO of software unit Cariad China, told Reuters. He said using the technology in Europe was technically possible but that the decision rested with headquarters in Germany.
That debate is live. Volkswagen brand chief Thomas Schäfer has proposed building about three-quarters of the next generation of Volkswagen, Skoda and Cupra models on the China-developed architecture instead of Rivian’s, manager magazin reported on Monday. Volkswagen has not commented on that report.
Rivian supplies the group’s Western software through a joint venture, and Audi plans to build its first US plant about 75 miles from Rivian’s new factory in Georgia.
Sales under pressure
The shift comes as Volkswagen’s business in China shrinks. Group deliveries in China fell 38.5% in the third quarter to 405,800 vehicles and 30.2% in the first nine months to 1,378,800, the company said earlier this month.
China accounted for about 81% of the 313,600-vehicle drop in the group’s global third-quarter deliveries.
Volkswagen’s battery-electric deliveries in China fell 42.5% to 48,900 in the first nine months, although its electrified deliveries there rose about 30% in the third quarter on plug-in hybrid and extended-range demand.
In September, Volkswagen cut its 2026 forecast to an operating return on sales of up to 1%, citing a challenging market environment “especially in China.” It will report third-quarter results on Thursday.
Brandstätter expects China’s passenger-car market to shrink by about 20% this year, Reuters reported. Chinese rivals such as BYD and Geely have taken share from foreign brands with cheaper, more software-heavy electric cars.
Volkswagen’s newest China models have drawn early demand. The FAW-Volkswagen ID. AURA T6 SUV and the SAIC Volkswagen ID. ERA 5S plug-in hybrid sedan, which both use CEA and Hyper Sense 8, each secured about 30,000 locked orders in their first weeks, Brandstätter said last week.
