Volkswagen China has recently announced a collaboration with CATL in the realm of battery swapping, aiming to introduce standardized battery modules compatible across multiple models. As a global leader among traditional automakers, Volkswagen's move not only mirrors the industry's concerns over the ongoing development of charging infrastructure but also signifies that the battery swapping model has transitioned from a niche market dominated by newcomers to a new phase of competition among mainstream manufacturers. This strategy not only addresses the lack of charging infrastructure and enhances user energy replenishment efficiency but also intensifies competition in the battery swapping arena.

Amidst the urgency to accelerate the development of charging infrastructure and users' persistent anxiety about energy replenishment efficiency, can the battery swapping model overcome its commercialization challenges? The race for energy replenishment efficiency and the divergence in technical approaches are already underway. How will the interplay and collaboration among industry stakeholders reshape the market landscape?

▍Entering a New Era of Competition Among Mainstream Automakers

The battery swapping model's core strength lies in its rapid "3-minute full charge" capability, offering significant advantages, particularly for long-distance travel and B-end operations. As a pioneer in this field, NIO boasts 3,154 battery swap stations nationwide as of March 10, 2025, covering over 800 county-level administrative regions, including 970 highway swap stations, significantly alleviating users' range anxiety and reducing charging time costs. Shen Fei, Senior Vice President of NIO, has publicly highlighted that a battery swap station's daily service capacity exceeds that of three charging piles, extending battery life and mitigating spontaneous combustion risks through centralized battery management.

However, NIO's battery swapping model is heavily reliant on its proprietary battery platform and user ecosystem, limiting compatibility with other brands, thus creating a closed-loop competitive barrier. Additionally, multiple battery swapping specification systems exist in the market, such as those from NIO, CATL, GAC, Geely, etc., leading to insufficient compatibility among automakers. For instance, despite a battery swapping agreement between GAC Aion and NIO, interoperability remains elusive.

Volkswagen's foray into battery swapping is a response to the pressures of the new energy transition. In 2024, sales of mainstream joint venture brands generally declined by over 30%, exerting considerable pressure on the transition. Volkswagen chose to partner with CATL, leveraging its battery technology and swapping expertise to rapidly deploy battery swapping networks and explore ways to break the deadlock.

Nevertheless, the automaker-battery manufacturer-energy operator ecosystem is undergoing qualitative changes, with numerous players in the market. CATL utilizes its battery technology advantages to form a competitive and cooperative relationship with automakers like NIO and Geely through the "EVOGO Battery Swapping Service," while the State Grid has collaborated with automakers such as GAC and Changan to establish the "Green Energy Alliance," promoting the construction of an integrated photovoltaic storage and battery swapping network. This multi-dimensional competitive and cooperative landscape not only accelerates technological advancement but also intensifies market competition.

▍Volkswagen's Battery Swapping "Breakout Strategy"

Building a battery swapping ecosystem is no easy feat, facing multiple challenges amidst a crowded market. In terms of cost sharing, the construction and operational costs of the battery swapping model are substantial. It involves significant capital investment, and expanding the battery swapping network on a large scale requires vast amounts of funds.

Volkswagen's plan to establish 500 battery swap stations in 2025, with each station costing approximately 2.5 million yuan in equipment alone, results in an initial investment exceeding 1.25 billion yuan. To break even, assuming a service fee of 2 yuan per kWh, each station would need to serve 120 vehicles daily, a feat challenging to achieve in third- and fourth-tier cities. Furthermore, operational costs for battery storage and maintenance must be borne, and the battery swapping model's profit cycle is relatively long, making short-term profitability elusive, thereby increasing cost pressures on automakers and operators.

On the other hand, the supercharging camp compresses charging time to 10-15 minutes for a range of 400-500 kilometers through high-voltage platforms (above 800V). Its advantage lies in compatibility with the existing charging infrastructure and minimal need for deep automaker collaboration.

Lastly, policy plays a crucial role. In February this year, the General Offices of the Ministry of Finance, Ministry of Industry and Information Technology, and Ministry of Transport jointly issued the "Notice on the Pilot Application for Improving County-level Charging and Battery Swapping Facilities in 2025," outlining plans to support 75 pilot counties in enhancing charging infrastructure in 2025. At the local level, cities like Shanghai and Shenzhen have planned special subsidies for battery swap station construction, yet some cities have already made rapid advancements in supercharging.

While the battery swapping model excels in energy replenishment efficiency, user experience, and battery management, it also confronts challenges such as high costs, standardization difficulties, and technical bottlenecks. Volkswagen's battery swapping strategy must not only resolve technical issues but also strike a balance in automaker cooperation, benefit distribution, and cost sharing.

Competition among OEMs in the battery swapping sector has already commenced in China. NIO's founder, Li Bin, previously stated on social media platforms that this year would be pivotal for the construction of NIO battery swap stations. Currently, NIO has signed battery swapping cooperation agreements with multiple automakers, including Changan Automobile, Geely Holding Group, JAC Group, Chery Automobile, Lotus Automobiles, GAC Group, and FAW Group, with relevant battery swapping models set to launch soon.

Volkswagen's entry could propel the battery swapping sector into the "era of giant competition." Automakers entering this space are striving to elevate their technical specifications to industry standards, evolving into a battle for technical standard discourse power.

Typesetting 丨 Yang Shuo Image Source: Volkswagen, NIO