FAW-Volkswagen sets new plant in Foshan
- Source: Global Times
- [17:42 May 12 2010]
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Volkswagen (VW) plans to build two plants in south China, but the announcement of the location of the first plant (Foshan, Guangdong Province in South China) seems to have left VW's partner, Shanghai-VW, quiet on the issue.
On May 11, VW President and CEO in China, Winfried Vahland, revealed that the location of the second plant will soon be announced by Shanghai-VW.
He also said that the chances of putting FAW-VW and Shanghai-VW's two plants together are slimmer, for both of them need to expand their production capabilities. FAW-VW hasn't revealed the models to be produced.
"It is a joint strategy for Volkswagen Group China, Shanghai Volkswagen and FAW volkswagen. We trust people in our company. We want to be a reliable partner in China and serve our customers in a positive way," said Vahland.
According to China Business News, the new plant of FAW-VW doesn't come from any acquisition. The government of Guangdong Province transferred the production license to FAW-VW.
The south now comprises only 12 percent of its market. Volkswagen has factories in the eastern city of Nanjing and the western city of Chengdu, while the south has manufacturing bases of Japan's Toyota, Honda Motor and Nissan Motor. Currently, more than 70 percent of Guangdong's automobile market is controlled by the Japanese automakers, especially Toyota.
Located in Changchun, FAW seems more urgent to expand the market in South China than Shanghai-VW. At present, VW's Shanghai partner is focusing on acquiring Nanjing's Fiat plant which could reach one million units of production capability after being reconstructed.
China became the biggest single market of Volkswagen for the first time in 2009, with a total sales volume of 1.4 million cars.
Agencies and Shi Jierui contributed to this story
