Volkswagen Expands Investment Program for China

Volkswagen announced that it has expanded its Chinese development program by an additional EUR 1.6 billion ($2.1 billion). The cash injection will add up to the EUR 4.4 billion ($5.8 billion) investment in the Chinese market, which was announced by the German company last year.

"Growth in the Chinese automobile market has exceeded everyone's expectations," said Prof. Dr. Martin Winterkorn, Chairman of the Management Board of Volkswagen Aktiengesellschaft. "The Volkswagen Group is already extremely well-positioned on this market of the future with an attractive product range. These additional investments will lay the foundations for a successful future for the Volkswagen Group in China."

The funds that will be used to develop new models and increase the production capacity will come from the cash flow of the Shanghai Volkswagen and FAW-Volkswagen Chinese joint ventures.This year, the carmaker will introduce a total of seven new or updated vehicles on the Chinese market, including the Golf GTI, the Tiguan LWB (long wheelbase) and others. In addition to that, the company will build two new plants in China.

"With these investments, we intend to boost the introduction of new models and advanced technologies on the Chinese market. The Volkswagen Group is convinced that these investments will maintain our market leadership in China and also allow us to take a leading position in the field of alternative propulsion technologies. We will reach our long term target of doubling our sales to two million vehicles according to plan," said Dr. Winfried Vahland, President and CEO of Volkswagen Group China.

The first quarter of 2010 saw VW Group’s Chinese deliveries rising by 60.9 percent (year to year) to 457,259 vehicles.
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