Volkswagen is evaluating "additional production capabilities here in the US dollar region," Volkswagen Group of America CEO Stefan Jacoby told the Automotive News Congress in Detroit.

"That way we can be more responsive in the marketplace and mitigate the effects of volatile currency exchange rates," he said.

He acknowledged that there had been "a lot of speculation on this front, including the silly rumours that I have been travelling the Carolina countryside. With a bunch of Germans. And we are purchasing land."

Jacoby refused to confirm an earlier Automotive News story that the automaker purchased, or had an option to purchase, land in Rocky Mount, North Carolina, east of Raleigh and Durham, the trade paper said separately.

Jacoby gave the conference few details, saying only: "The decision on local production will come in the next six months. Stay tuned."

He said that the US plant would build volume models with state-of-the-art technology and hinted that it would be built near an established supplier corridor.