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FAW VW builds new plant in Guangdong
By Jin Jing |
17:42 UTC+8 May 26, 2010
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Online Edition
Online Edition
FAW Volkswagen has agreed to locate its 8 billion yuan (US$1.17 billion) new plant in Foshan in Guangdong Province as part of the German auto maker's ambition to strengthen operations in China's south, Economy Observer reported today.
According to Guangdong Province, the joint venture between FAW Group Corp and Volkswagen will build a plant to make 300,000 units a year in Foshan's Nanhai District.
Construction will kick off next year and be completed by 2013, the newspaper added.
FAW Volkswagen's spokesman is not available for comment today.
At the end of April, Volkswagen AG announced an extra 1.6 billion euros (US$2.1 billion) investment in China to build two new plants and add new models to meet rising market demand.
Lacking a strong footprint in south of China prevented Volkswagen from keeping a leading position in China's overall auto market.
The south, which has faster economic growth and richer consumers, has been dominated by Japanese car makers including Toyota Motor Corp, Honda Motor Corp and Nissan.
Industrial analysts said FAW VW's new plant would help it shorten delivery periods and build stronger sales networks for a bigger slice of the market.
Volkswagen aims to boost sales from 150,000 units to 500,000 units in the south of China within three to five years while lifting market share to around 19 percent from 12 percent in 2008.
Volkswagen is the second largest international auto maker in China, following General Motors. First quarter sales of Volkswagen jumped 61 percent to 457,259 vehicles in Chinese mainland and Hong Kong.
Its total new investment in China, on the world's largest auto market, has been brought to 6 billion euros since last year.
According to Guangdong Province, the joint venture between FAW Group Corp and Volkswagen will build a plant to make 300,000 units a year in Foshan's Nanhai District.
Construction will kick off next year and be completed by 2013, the newspaper added.
FAW Volkswagen's spokesman is not available for comment today.
At the end of April, Volkswagen AG announced an extra 1.6 billion euros (US$2.1 billion) investment in China to build two new plants and add new models to meet rising market demand.
Lacking a strong footprint in south of China prevented Volkswagen from keeping a leading position in China's overall auto market.
The south, which has faster economic growth and richer consumers, has been dominated by Japanese car makers including Toyota Motor Corp, Honda Motor Corp and Nissan.
Industrial analysts said FAW VW's new plant would help it shorten delivery periods and build stronger sales networks for a bigger slice of the market.
Volkswagen aims to boost sales from 150,000 units to 500,000 units in the south of China within three to five years while lifting market share to around 19 percent from 12 percent in 2008.
Volkswagen is the second largest international auto maker in China, following General Motors. First quarter sales of Volkswagen jumped 61 percent to 457,259 vehicles in Chinese mainland and Hong Kong.
Its total new investment in China, on the world's largest auto market, has been brought to 6 billion euros since last year.
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