FAW-VW aims to sell 1.5m vehicles this year

Gasgoo.com (Shanghai January 18) - FAW Volkswagen's sales target for this year is set at 1.5 million vehicles, xkb.com.cn reported today. The figure, which was officially announced earlier this week, is the highest to have been announced by an automobile enterprise operating in the Chinese market. However, some analysts point out that the figure is only ten percent higher than the amount the joint venture sold last year.

FAW-VW's key problem in China has not been consumer demand, but rather its limited production capacity. The increased sales target this year seems to have been made with this factor in mind. The joint venture has recently focused specifically on boosting production volume, with reports of FAW-VW workers in production earning a noticeable amount of money from working long periods of paid overtime when compared with their colleagues working in sales.

In 2011, FAW-VW managed to surpass its one million vehicle sales target by 35,000 vehicles. However, several figures in the industry point out that the JV had to put considerable strain on its Changchun factory to meet consumer demand. Looking at the number of buyers put on waitlists when buying FAW-VW vehicles, it is reasonable to assume the JV's sales for that year would have been much higher had there been no production limits. Sun Guowang, FAW-VW's recently appointed executive office director, mainly attributed the JV's relatively poor performance on J.D. Power's Customer Service Index to its limited production capacity.

Thanks to the opening of its new factory in Sichuan's capital of Chengdu, FAW-VW was able to alleviate some of the problems it had with limited production in 2012. The number of buyers put on waitlists for popular models significantly decreased from 2011. That, combined with the introduction of new models including the New Sagitar, allowed FAW-VW to exceed its 1.2 million sales target by 160,000 units. However, considering that full scale operation at its new factory in Foshan, Guangdong will have to wait until 2014, it is understandable why its target for 2013 is not much higher than 2012's final sales result.