Audi Restructures China Operations to Strengthen EV and ICE Market Strategy

Audi is preparing a major restructuring plan for its joint venture operations in China as competition intensifies across both internal combustion engine and electric vehicle segments. According to reports from Chinese media outlet Mingjing Pro, the German automaker will reorganize responsibilities between its two local partnerships to improve operational efficiency, reduce overlap, and strengthen its position in the rapidly evolving Chinese automotive market.

Under the proposed restructuring, all sales rights for Audi models carrying the traditional four-ring logo, including both internal combustion engine vehicles and electric vehicles, will be transferred to FAW Audi. The joint venture, headquartered in Changchun in Jilin province, will become the primary sales channel for Audi’s mainstream branded vehicles in China.

At the same time, SAIC Audi, based in Shanghai, will reportedly stop handling traditional combustion engine vehicle sales. Instead, its operations will fully concentrate on the newly introduced AUDI letter-logo sub-brand, which was jointly developed by SAIC and Audi specifically for the Chinese market. The move is aimed at improving differentiation between the two ventures while allowing Audi to pursue separate strategies for conventional vehicles and intelligent electric mobility.

The AUDI brand was officially launched in China on November 8, 2024, representing a distinct sister brand tailored for local consumers. Unlike the traditional Audi identity that uses the iconic four-ring emblem, the new brand adopts fully capitalized AUDI lettering as its logo. Audi introduced the brand to address shifting consumer preferences in China’s highly digital and technology-focused EV market.

The first production model under the AUDI brand, the E5 Sportback, entered the market in September 2025. More recently, AUDI started pre-sales for its second mass-production model, the AUDI E7X, on May 8, with a starting pre-sales price of 289,800 yuan.

Key Developments in Audi’s China Restructuring Strategy

The restructuring strategy reflects Audi’s broader effort to maintain profitability in the traditional vehicle segment while accelerating growth in intelligent electric mobility through localized innovation and technology partnerships.

Last month, Audi and SAIC signed a fresh strategic cooperation agreement to deepen collaboration in advanced vehicle technologies and intelligent mobility development. A major part of the agreement involves the creation of a new Audi-led innovation and technology center in Shanghai that will focus on complete vehicle research and development activities.

The partnership will utilize the Advanced Digitized Platform (ADP), a next-generation smart vehicle architecture designed for future intelligent connected vehicles. Using this platform, Audi and SAIC plan to jointly launch four all-new AUDI-branded models over the coming years. These vehicles are expected to significantly expand Audi’s electric mobility lineup in China while incorporating advanced local technologies tailored to Chinese customer expectations.

The upcoming AUDI models will feature technologies sourced from major Chinese suppliers and technology firms. Battery systems will be supplied by CATL, intelligent driving systems will come from Momenta, and AI large-model capabilities will be integrated through ByteDance technologies. The heavy localization approach is intended to improve development speed, software integration, and competitiveness against fast-growing domestic EV manufacturers.

In addition to pure battery electric vehicles, SAIC Audi management has indicated that plug-in hybrid electric vehicles and extended-range electric vehicles are also being evaluated as potential future technology pathways. The company is assessing multiple propulsion strategies to respond to changing customer demand and evolving market conditions in China.

Meanwhile, FAW Audi is focusing on improving the competitiveness of its combustion engine and PPE-platform electric vehicles through the integration of advanced smart technologies from Huawei. This approach is designed to strengthen product appeal in both premium ICE and premium EV segments while supporting Audi’s long-term transition strategy.

Through this dual-track operational model, Audi aims to reduce long-standing overlap and internal competition between its northern and southern China joint ventures. By separating product responsibilities and sales channels more clearly, the company expects to improve efficiency, streamline product positioning, and enhance its ability to compete in the world’s largest automotive market.

Frequently Asked Questions

Why is Audi restructuring its China joint ventures?
Audi is restructuring its China operations to improve competitiveness in both traditional and electric vehicle markets while reducing overlap between its two joint ventures. The company plans to centralize four-ring branded vehicle sales under FAW Audi and dedicate SAIC Audi to the AUDI electric sub-brand. This strategy is intended to strengthen operational efficiency, improve market positioning, and accelerate localized intelligent vehicle development using Chinese technology partnerships and smart mobility platforms tailored for local consumers.

What is the new AUDI brand launched in China?
The AUDI brand is a China-specific electric vehicle sub-brand jointly developed by Audi and SAIC for the Chinese market. Unlike the traditional Audi brand that uses the four-ring logo, AUDI uses fully capitalized lettering as its identity. The brand focuses on intelligent connected electric vehicles with localized technologies, including batteries, smart driving systems, and AI integration from Chinese technology companies. Audi launched the first AUDI production model in 2025 and plans additional vehicles based on its Advanced Digitized Platform.

Which companies are supporting Audi’s new EV technology strategy in China?
Audi’s new China-focused EV strategy includes partnerships with several major Chinese technology and automotive companies. CATL is supplying battery technologies, Momenta is providing intelligent driving systems, and ByteDance is contributing AI large-model capabilities. Huawei technologies are also being integrated into certain FAW Audi models to strengthen smart vehicle competitiveness. These partnerships allow Audi to accelerate localized innovation, improve software-defined vehicle capabilities, and respond more effectively to China’s fast-moving intelligent mobility market.