COMPANIES One of Volkswagen's operations in China on Tuesday announced a sharp reduction in the prices of its cars, in what could be the first shot in a new price war.
The announcement by Shanghai Volkswagen that it would cut prices by up to 14 per cent was the latest attempt by the German carmaker to maintain its position as the leading brand in the Chinese market. However, in an indication of the challenges facing VW's new management in China, the group's other joint venture there said it would not reduce prices. Li Dan, a spokesman for FAW Volkswagen, said: “We will stick to our original sales strategy. Price-cutting is not a wise way to lead consumers to rational consumption and it would hurt ourselves.”
