VW shelves Seat plans for southern China strategy
- Source: Gasgoo
- [08:59 May 25 2010]
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Volkswagen and its China partner FAW Group previously planned to produce VW's Spanish brand Seat cars in southern China, but it appears that VW's plans for Seat have so far been shelved, China Car Times said May 24.
FAW-VW joint venture has decided to build a factory in Guangdong's Foshan city to produce new car models that can appeal to young wealthy buyers in southern China, especially Cantonese buyers who traditionally preferred Japanese brands to VW models.
Seat was initially hailed as VW's new entry model in southern China, a market that VW has always underperformed in sales, compared to Japanese giants of Toyota and Honda, which both have local joint ventures with Guangzhou Auto, producing Toyota Camry, Honda Accord, among other Japanese models.
VW believes that factories must be built in the South China to boost sales in the region and has pushed its joint venture partners to open factories there. While FAW-VW will set up a plant in Foshan, Shanghai-VW will build a factory in Guangzhou, provincial capital of Guangdong.
Recently VW has shelved the Seat plans for its southern China strategy. The German auto giant may wants to get its factories set up and further establish the Skoda brand in China before launching more new brands in China.
Another reason for delaying the introduction of Seat into China is Seat's large small-car line-up which would go directly against VW's recent small-car line-up of the Bora, Lavida, Golf and Polo, China Car Times said.
