VW Prepares 25.8bn EUR Three-Year Investment Plan

While others are trying to survive the current economic situation, German automaker VW announced it is preparing a huge 25.8bn euro ($38.3 bn) investment. In a time of uncertainty and chaotic financial operations, VW understood that you have to actively influence the market before it influences you.

After they’ve recently been reported as having one of the best results this year amid international car makers, VW Group is prepared to invest abundantly in its operations in order the stay in line with future consumer demand.

In a press statement on November 20, the Wolfsburg-based automotive group detailed its investment plan, saying that some 19.9bn EUR are planned for investment in property, plant and equipment, half of which will be invested in Germany alone.

The remaining sum of 5.9bn EUR represents capitalized development costs.

"The automotive industry is facing significant economic and technical challenges. The Volkswagen Group is vigorously driving forward its long-term growth strategy by investing in environmentally friendly models, innovative technologies and new plants. We are continuing to make focused investments in our future", said Prof. Dr. Martin Winterkorn, Chairman of Volkswagen Aktiengesellschaft’s Board of Management.

The German automotive group targets building new facilities, improving its engine range, expanding model range with emphasis on the company’s multi-brand modular matrix strategy (for new generations and variants on nearly all models).

VW will also develop their transmissions as the company noted an increased consumer demand for the automatic gearbox. Aside from manufacturing areas, VW will direct their investment in the areas of development, quality assurance, genuine parts supply and IT.

"These investments are the basis for secure jobs and the further development of our global facilities. We can only offer the best products tomorrow if we invest today. And this is what the Board of Management and the workforce throughout the Volkswagen Group are focusing on", stressed Bernd Osterloh, Chairman of VW’s Group Works Council.

VW Group mentioned the joint venture companies from China aren’t included in this investment plan, as they are yet to be consolidated. Those companies are expected to have an investment plan of their own, accounting for some 4.4bn EUR between 2010 and 2012.