BEIJING - Volkswagen aims to preserve its market share in China at about 15% in 2030, the head of its China business said, betting heavy investment there will help it maintain its competitiveness against local electric vehicle (EV) rivals.

Volkswagen ceded its title of best-selling car brand in China to Chinese EV giant BYD in late 2022, and the group's market share in China fell to 14.5% last year from 19.3% in 2020 as combustion-engine sales declined.

Group board member and China chief Ralf Brandstaetter told reporters Volkswagen was confident it could maintain or slightly increase this share.

He cited investments in a new Chinese research hub, and partnerships with Chinese EV makers and suppliers to develop more affordable EVs, more quickly.

"We want to be the number one international OEM in China in 2030 with 15% market share," he said in comments embargoed to coincide with a capital markets event on Volkswagen's China business held by the carmaker on Wednesday.

The 15% market share would correspond to selling 4 million cars in China annually by 2030, up from 3.07 million last year, it said. In addition, it is targeting proportionate operating profit of more than 2 billion euros ($2.14 billion) in China in 2027 and around 3 billion euros by 2030, up from 2.6 billion euros last year.

Volkswagen CEO Oliver Blume earlier this month said the group "cannot keep up at the top of the table at the moment" in China's fast-growing EV market, adding a market share of more than 10% would be "very respectable" given fierce local competition.

China has undergone a big shift from the combustion-engine age when foreign-made cars, especially those from Germany and Japan, were seen as the pinnacle of global engineering, to the electric age that has seen their Chinese counterparts move much faster on developing EV technology.

Among the incumbent foreign automakers, Volkswagen has arguably mounted the biggest fight to stay competitive against the likes of BYD and U.S. automaker Tesla, including participating in a bruising price war that started last year and has since drawn in more than 40 brands.

Volkswagen's ID.3 became one of the best-selling EVs in China after the automaker slashed the price by just over $5,100.

With its current offerings priced above that of many Chinese electric-only rivals, the German carmaker is pushing to expand its product range in China to attract customers in the entry- and mid-level segment of EVs.

"The price war has victims and we don't want to be a victim," Matthias Glodny, Volkswagen Group China's vice president for products, told reporters at the Tuesday briefing.

"We're feeling it's not a sustainable way to continue, but, of course, we are fighting back."

($1 = 0.9345 euros)

(Reporting by Sarah Wu and Daniel Leussink in Beijing; Additional reporting by Christoph Steitz in Frankfurt; Editing by Brenda Goh and Jan Harvey)