Volkswagen said it can produce electric vehicles in China for half the cost of elsewhere, as the German carmaker seeks to regain market share in the world's largest auto market, reports London's Financial Times.

Europe's biggest carmaker said that, after a series of investments, it could for the first time develop cars outside Germany, including testing and deploying assisted driving technologies.

VW plans to launch about 30 EV models in China over the next five years, betting on localised research and development. The company said costs for some models had been cut by as much as 50 per cent compared with 2023 German production levels, citing supply chain efficiencies, battery procurement, shorter development cycles and lower labour costs.

The group has invested billions in its innovation centre in Hefei, eastern China, which houses more than 100 laboratories for testing software, hardware, batteries and EV powertrains.