By Kate Yuan

(JW Insights) Apr 19 -- German auto giant Volkswagen Group will establish 100%TechCo, a new center for development, innovation, and procurement for fully connected electric cars, in Hefei City of eastern China’s Anhui Province, it announced on April 18. The investment will be about EUR1 billion ($1.09 billion).

The project will reduce the development time for new products and technologies by about 30%, according to Volkswagen. Local suppliers will be able to participate in product development at an early stage and integrate state-of-the-art technologies into new products, said the group. It is scheduled for operation in early 2024.

The new company will also integrate the development projects of all of the Volkswagen Group's joint ventures in China including SAIC Volkswagen, FAW-Volkswagen, and Volkswagen Anhui.

Ralf Brandstätter, Group Board Member for China, said "The establishment of 100%TechCo is an important step of our ‘in China, for China’ strategy. By consistently bundling development and procurement capacities as well as integrating local suppliers at an early stage, we will significantly accelerate our development pace.”

Volkswagen previously said that its "in China, for China" strategy helps to further extend local partnerships. The group also established CARIAD China to accelerate research and development, expand software development paths, and promote technological concepts with Chinese features.