FAW-VW planning to release economy car

Gasgoo.com (Shanghai March 11) - FAW Volkswagen is planning to release a new economy car, the Beijing Times reported today, citing a statement made by the joint venture's General Manager Hu Yong. According to Mr. Hu, the new model will be cheaper than the Jetta and will be aimed at China's economy car market.

FAW-VW's current product line up is mainly made up of compacts and midsize sedans. Aside from previous announced plans to release a new SUV model, the JV has not revealed intentions in expanding to other segments. A FAW-VW official explained that the JV's avoidance of the subcompact and microvan segments is due to low expected profits from sales of those vehicles.

Mr. Hu has made it clear that the JV will begin expanding into new segments in the future. One of his goals is to release a more inexpensive VW for buyers in the lower segments of the market. Plans for such a model are still being discussed.

Senior officials from VW have previously stated their intent to release an economy class car in 2015 aimed at China, Brazil and other emerging economies. Whether or not this model is the same as the one mentioned by Mr. Hu is still unclear.