Volkswagen AG said on Wednesday that it had delivered the China Electronic Architecture in late 2025 as scheduled, marking a significant step in its local vehicle development capabilities in the world's largest automotive market.

"In just 18 months, we have for the first time built a completely new, scalable electronic architecture from development all the way to series production – maintaining the high quality and safety standards that our customers expect from Volkswagen," said CEO Oliver Blume.

The architecture was developed by Volkswagen Group China Technology Company, CARIAD China and Chinese startup XPeng.

With the delivery of the CEA, the German carmaker said it has established full end-to-end capabilities in software-defined vehicle development, from concept and engineering through validation and mass production.

The first CEA-based model, the VW ID. UNYX 07, has rolled off the assembly in Hefei, Anhui province. Four further VW vehicles will be built with the new architecture this year.

Compared with previous vehicle generations, the CEA reduces the number of electronic control units by around 30 percent, significantly streamlining system complexity.

The company said this provides a stable foundation for advanced AI cockpit functions, China-specific driver assistance systems and full-vehicle over-the-air updates.

Also, enabled by the new development process, overall vehicle development cycles are shortened by up to 30 percent.

Through localized development and early supplier integration during the concept phase, development costs for new models are reduced by up to 50 percent in selected key projects.

Agile development processes also allow rapid adjustments to evolving customer requirements, strengthening Volkswagen's competitiveness in China's smart connected vehicle market.

Analysts said the move will help sharpen its competitive edge in Chinese passenger vehicle market, where local Chinese carmakers account for almost 70 percent of sales.

Volkswagen AG delivered 2.69 million vehicles in China in 2025, down 8 percent year-on-year, although it remained the most popular international carmaker in the country.