Volkswagen AG (VW), Europe's largest carmaker, is building its 10th manufacturing plant in China to expand its manufacturing capacity in the world's biggest auto market.
The new plant, to be located in Foshan city of Guangdong Province, will be built under FAW-Volkswagen, a joint venture between First Automobile Works Group, Volkswagen AG, Audi AG and Volkswagen Automobile Investment Co.
The Foshan plant, which is expected to open in mid-2013, will be built on a 170-acre site having an annual production capacity of 300,000 vehicles and cost around $662 million, which will be financed from cash flow of FAW-Volkswagen, the Wolfsburg, Germany-based VW said in a statement yesterday.
"China is the Volkswagen Group's largest and most important market worldwide. Here we want to grow in tandem with our partners. With our unprecedented investment we will double our capacity in China each year until 2013/14 to around three million vehicles,'' said Prof. Dr. Martin Winterkorn, CEO of VW.
The new plant in Foshan is part of VW's current programme to increase investment in China from €1.6 billion to €6 billion and to double production capacity in the country to 3 million vehicles.
The company plans to expand its leadership in the Chinese market and expand capacity to meet the increasing demand. In the first five months of this year, VW sold about 778,000 vehicles in China.
VW has already bought out seven new models in the Chinese market from local production and plans to bring 20 more by 2012.
VW currently has nine plants in China from its two joint ventures-FAW-Volkswagen and Shanghai Volkswagen, which produce about 20 models of Volkswagen, Skoda and Audi.
The automaker also plans to start electric car production in China by 2013/2014.
The new plant of VW in Guangdong Province is also the home to other major carmakers plants like Honda, Toyota and Nissan.
