Asia Tech Wire (Apr 12) -- German automaker Volkswagen said Thursday it will spend 2.5 billion euros ($2.69 billion) to further expand its production and innovation center in Hefei, China.

In addition to strengthening its research and development capabilities in China, the investment will also speed up the production of electric models it has partnered with Chinese electric car startup Xpeng Inc. (9868.HK), Volkswagen said in a statement.

The company will produce two models under the Volkswagen brand in Hefei that it is co-developing with Xpeng, the first of which will be a midsize SUV that is due to go into production in 2026.

Volkswagen said it will offer more than 30 all-electric models in the Chinese market by 2030.

According to its product plan, Volkswagen will launch 11 new EVs by 2027, including the two models jointly built with Xpeng.

In addition, the German automaker will launch the ID. 2all in 2025 and bring it to market in 2026.

Volkswagen will also bring a new entry-level model, known as the ID.1, at around 20,000 euros in 2025, which will go on sale in 2027.