VW outlines EUR9 8bil Chinese investment plan — Volkswagen Bora

11 Июн 2015 | Author: | Комментарии к записи VW outlines EUR9 8bil Chinese investment plan — Volkswagen Bora отключены
Jetta spearhead

VW outlines EUR9.8-bil. Chinese plan

VW and GM are going head-to-head major investments to raise in the country and take market from each other.

At a preview event, Volkswagen Group outlined its plans to its hold and increase its market in China with an overall of EUR9.8 billion.

From to 2015, VW Group China is to in the expansion of its production capabilities in the which will be financed the cash flow of its Chinese (JV) companies. The objective is to production capacity to 3 million per year in the medium term and 4 vehicles until 2018, as as the development and manufacture of new products in with market requirements, to the automaker.

By 2015 we want to the offering to over 90 models, Heizmann, head of VW China, Indeed, Heizmann himself was in to spearhead VW’s China with effect from 1 2012. By 2018, the VW Group employ 100,000, up from the 75,000, he added.

In order to increase annual production in China to over 4 per annum in 2018, up from 2.6 now, the automaker will seven new plants, of which will open this in Urumuqi, Foshan, and Ningbo production plants), and in Changchun and (auto parts plants). is in the western Xinjiang province, Foshan is in the southern Guangdong Ningbo is in the coastal Zhejiang

VW will also open a new transmission plant in Tianjin in while recent media state that FAW-VW may a new plant in Changsha in Hunan This would bring the to seven new plants.

VW has two state-owned, JV production partners in China: Volkswagen (SVW) with Automotive Industry Corp (SAIC); and FAW-VW with Automobile Works (FAW). VW and its JV produce models under the Volkswagen, Audi, and Škoda for the market, with production the supply of engines and vehicle for the models produced. In total, VW has vehicle production facilities and six production plants at 11 locations in the

SVW currently produces the Santana, Lavida, Touran, Tiguan, and new models at its plants in Anting, and Yizheng. The Škoda models Octavia, Fabia, and Rapid are produced at these plants. SVW has a technology centre and a design and produces engines in Shanghai. In to this, two new vehicle plants be opened in 2013 in Ningbo and

FAW-VW currently produces the Jetta, Magotan, Magotan CC, new and Sagitar VW models at two plants in and Chengdu. The Audi models include the A4L, A6L, Q3, and Q5. also produces engines at its in Changchun. In addition, a new vehicle in Foshan is scheduled to open in

Dealerships to be expanded to over

The VW Group has 1,900 dealers for of the VW, Audi, and Skoda brands. The consists of two sales structures, are assigned to SVW and FAW-VW. Separate structures for each of the two companies optimum market-positioning of their within the appropriate target All of the import business of the VW brand is by the Volkswagen Import Company, imports the Volkswagen Phaeton, for

In the medium term, VW aims to the number of dealers to 3,000, doubling the workforce in the distribution from 80,000 to 160,000, the has said.

Outlook and implications

VW is to extend its penetration to regions in that have so far seen low ratios of cars per 1,000 per This will take VW the west to Xinjiang – a province is currently part of an extensive drive. Speaking at the event, said VW’s main is to be the first in the region, with the aiming to benefit from present in a region even the majority has the financial power to buy Togther with its production which will open year in Urumuqi in Xinjiang, the will increase the number of offering finance options. 3 and tier 4 cities are going to be the the bread and butter for all of us, said Soh, who heads up VW sales in the (see China: 22 April Shanghai Motor Show Fighting for the Chinese consumer ). VW the tier 3 and tier 4 cities promise growth for its imported (see China: 26 February VW to set up dealerships for imports in tier-four in China ).

VW sales rose by 21.3% in the quarter 2013 period in (see China: 16 April VW China’s sales rise y/y in Q1 ). However, arch rival Motors (GM) and its JVs sold units in China in the first period, with sales of units, up 9.6% y/y (see 3 April 2013: GM China up 9.6% Y/Y in Q1 ).

VW is being aggressive in the to maintain market share in as competition in the region intensifies. The VW brand held the largest share in 2012 in China, for 11.44% of the light vehicle according to IHS Automotive data. accounted for 1.24%, while held a 2.18% share in However, by 2015 our forecasts that the VW brand’s market will drop to 10.14%. To this, the automaker has started to more plants in China and its production across different while concentrating on expanding its network in the lower-tier Chinese which still command sizes of 1 million (see 2 April 2013: The multiple for passenger vehicles within 2020 ).

However, GM has also got ambitions for and has just announced plans for an investment drive in the country China: 23 April 2013: GM outlines USD11-bil. investment with focus on smaller for luxury car sales ).


So far, strategy has been to sell models in the C and D segments, which up the automaker’s total sales in China, but it is also bringing in models under its Audi in order to gain in the premium as well as Skoda, which also see new models added to the lineup this year, as the Yeti. Meanwhile, VW will raise imports under such as SEAT, which it will become the choice for 2 and tier 3 city urban who want imported models.

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