BERLIN, Jan 26 (Reuters) - Volkswagen has promised to continue to set sensible sales targets for its car dealers in China to ensure a financially healthy distribution network in a slowing market.
The German group said on Monday it would continue to pursue a “mutually beneficial and sustainable partnership” with Chinese dealers based on an agreement the carmaker has reached with distributors in the world’s No. 1 auto market.
“Satisfied dealers create satisfied customers,” a spokeswoman for VW’s China operations said by email. “Through close cooperation and constant exchange with our dealerships in China, we constantly develop the VW brand together with our sales partners.”
Chinese auto dealers have complained to the government that inflexible targets set during a market boom obliged them to buy too much stock and bear the brunt of a drop in demand. Growth of China’s auto market halved to 6.9 percent in 2014.
Earlier this month, China’s dealers’ association said it had persuaded Germany’s BMW to pay 5.1 billion yuan ($815.54 million) in subsidies to dealers, while VW’s Porsche and Toyota Motor Corp are also negotiating with their Chinese dealers over subsidies and sales targets.
$1 = 6.2535 Chinese yuan renminbi Reporting by Andreas Cremer and Jan Schwartz; editing by Susan Thomas