Volkswagen AG will be launching a luxury sedan designed solely for China next year. This move to cater exclusively to the citizens of the country with the largest population in the world shows VW's pursuit of higher margins, but it could put it in direct competition with its premium brand, Audi. 

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The sedan will be based on Audi's A6, China's top selling luxury vehicle. However, no information has been disclosed regarding the elements that will make it designed solely for China. The China's A6 is larger than any other country's offering. It provides more leg room and larger build than any of its competitors. The price of the Volkswagen premium sedan has yet to be determined, but it would be unwise to price it close to the A6's $62,375 starting price because it may eat up Audi's sales. Volkswagen sells three times more cars than Audi, but the latter earns more than double the profit of the former. 

Volkswagen wants to boost its brand value, which is natural for any company that wants higher margins, but it is no easy task. If the VW luxury sedan is priced too high, people would rather buy the Audi A6, but if the price is too low, there is no point in purchasing a luxury Volkswagen sedan. 

A person not authorized to speak to media went on record saying that, "Premium models under Volkswagen will be attractive to individuals who want superior vehicles, but do not want too much attention." 

China's premium car market could soon surpass the United States because of the increase in affluence of Chinese citizens. Their entry into the premium car market will start towards the end of the year 2015, with an annual sales target of 50,000 vehicles. To elevate Volkswagen's brand image in China, it will open 100 upscale dealerships across China over the course of the next three years. The décor and service of these places will reportedly provide buyers a different feel and ambience.

Tagsvolkswagen, audi