VW Confirms Buying Karmann Assets

Volkswagen officially announced it is going to buy assets of German contract carbuilder Wilhelm Karmann GmbH, in order to create a new manufacturing subsidiary that will eventually build a new car model,  detnews.com reported. This means that Volkswagen will acquire land, machinery and equipment from Karmann, and it’s going to invest around 26 billion euros in the next three years in order to perform the needed upgrades.

Officials said that Volkswagen intends to start production at Karmann’s main Osnabrueck in 2011, but did not mention which models they will produce. VW also said they will create 1,000 jobs by 2014. At first, they will hire 200 people in 2010 in order to be able to start production as promised.

"The automotive industry is facing significant economic and technical challenges," said Martin Winterkorn, the VW’s chief executive. "The Volkswagen Group is vigorously driving forward its longterm growth strategy by investing in environmentally friendly models, innovative technologies and new plants. We are continuing to make focused investments in our future," Winterkorn said.

The company's main workers' representative, Bernd Osterloh said the investments are the basis for securing jobs and the further development of the company's global facilities. "We can only offer the best products tomorrow if we invest today. And that is what the board of management and the work force throughout the Volkswagen group are focusing on," Osterloh said.

As you might remember, Karmann is specialized in building bodies and components for cars, assembling them for other manufacturers. Its most famous model is the Karmann Ghia built on a Old Beetle chassis, from 1955 to 1974.