BEIJING — Volkswagen and joint venture partner China FAW Group will begin construction in Tianjin next week on a plant with capacity to produce 300,000 cars annually.
The plant is due to be completed by 2018, a VW spokesman in Beijing said today.
He declined to put a value on the project, but state-owned newspaper China Daily cited an FAW-VW joint venture official saying the investment was worth 19.5 billion yuan ($3 billion).
VW had previously announced that it planned to build a factory in Tianjin, a northern port city, that would start production by 2018, but had not provided more details at the time.
The automaker has broadly maintained its production and investment plans in the world’s largest car market despite sluggish sales growth as China’s economy expands at its slowest rate in 25 years.
The spokesman said the company is aiming for an annual production capacity of five million by 2020. VW said last year it would hit that mark by 2019.
“Generally, we stay on our investment plans, with some modifications of course which is normal and which will always be done,” VW China chief Jochem Heizmann told reporters in Beijing last month. “We will use these capacities and have some more flexibility to react.”
Heizmann said ahead of last month’s Beijing auto show that the company would invest 4 billion euros ($4.49 billion) with its joint venture partners in China this year.
In addition to FAW-VW, the company also makes passenger cars through a separate joint venture with SAIC Motor Corp.
Volkswagen sales grew 6.4 percent in China in the first quarter compared to a year prior, bouncing back from a 3.4 percent decline in sales for full-year 2015.
culled from: autonews.com