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German carmaker Volkswagen AG on Wednesday said it will build a new plant at Foshan, the company’s first factory in the southern Chinese region of Guangdong, to expand its presence in the world’s biggest auto market of China.
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Chairman Martin Winterkorn, who signed the contract to build a factory in Foshan said, “With our unprecedented investment program, we intend to double our capacities in China to three million vehicles per year by 2013-14."
Volkswagen and its partner FAW-Volkswagen plan to invest about 520 million euros in the new Foshan plant, which will have an annual production capacity of 300,000 units, the company said in a statement.
Construction work on the plant spread over an area of 170 hectares will start by the end of the year, employing about 4,000 people, the company said.
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Production at the new Foshan plant will start in mid-2013, Volkswagen said.
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Volkswagen, Europe’s largest carmaker, along with its partners FAW-Volkswagen and Shanghai Volkswagen, have a total of nine plants in China making about 20 Volkswagen, Audi and Skoda models.
Volkswagen had said in April that it would boost investment for China by 1.6 billion euros to 6 billion euros.
The company said it will launch seven new or modified locally produced models for the Chinese market this year, adding that it plans to introduce over 20 new models by 2012. For this purpose, Volkswagen is investing about 6 billion euros in new products and the expansion of production capacities by 2012.
The company said it also plans to make electric cars in China in 2013-14.
Volkswagen sold about 778,000 vehicles in the first five months of the year in China, exceeding its record deliveries it made in 2009 by 48 percent.
Foshan has Honda manufacturing units already and many other auto parts makers.
