Volkswagen will announce in coming weeks that it will build the second-generation Sharan (minivan/MPV) at its plant in Portugal, company sources told Automotive News Europe (ANE).

The production of the new edition of the large minivan, and its sister model, the Seat Alhambra, is set to start in late 2008, according to VW sources.

Sharan production began at the Autoeuropa plant, opened as a joint venture by Ford and VW, in 1995. The Alhambra and the first-generation Ford Galaxy also were built there. The Sharan's future was unclear after Ford decided to build the second-generation Galaxy by itself at its plant in Belgium.

VW sources said the main reason the new Sharan and Alhambra will arrive two years after the Galaxy is because VW wanted to find a new development partner.
PSA/Peugeot-Citroen was among the automakers that turned down VW, a source told ANE.

The production of the Sharan and Alhambra will bring Autoeuropa to full capacity, 180,000. VW plans to make 50,000 Sharans and 30,000 Alhambras a year.