Wolfsburg, we have a problem: How Volkswagen stalled in China

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BEIJING, Aug 9 (Reuters) – In late December 2019, managers at Volkswagen (VOWG_p.DE) headquarters in Wolfsburg realised they might have a serious problem in China, the company’s biggest market and ticket to its electric future.

Its flagship Passat sedan had fared badly in an unofficial safety test carried out by an insurance industry body which simulated a front-on driver’s side collision, a test that’s been widely used in the United States for around a decade.

The car was mangled. The crash-test video went viral, attracting millions of views and triggering a social media furore across China, where the German auto king’s success is built on its reputation for superior quality and engineering.

Volkswagen was not obliged to do anything – the Passat had passed the Chinese regulator’s frontal collision test, the same test that’s used in much of Europe, and one that the carmaker and many industry experts believe better reflects driving conditions in China.

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