Volkswagen Group has said it will expand its vehicle assembly operations in China further than expected to keep pace with continuous growth in the Chinese market.
VW China chief Jochem Heizmann said plant capacity will increase to more than the previously targeted 4m units a year by 2018, up from 3.1m vehicles in 2013.
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Speaking ahead of the Guangzhou motor show he said that VW’s sales growth in China had slowed because it can’t make enough vehicles. The German company is the top foreign carmaker in China, and assembles VW, Audi and Skoda brands with local partners FAW and SAIC.
Heizmann said that VW’s Chinese plants are operating more than 300 days per year, including weekends. It is opening a new plant in Changsha and started construction of a factory in Qingdao, in eastern China, earlier this month.
The German carmaker is on course to retain its top sales rank in China this year with deliveries forecast at more than 3.6m vehicles, up 10% over last year, and the country’s passenger-vehicle market is expected to grow by a single digit percentage in the next five years.
China accounts for about a third of the VW group’s global volume. Its share of the two Chinese joint ventures’ nine-month operating profit rose 11% from a year earlier to eur3.9bn (US$4.9bn).
The German company is currently in talks on raising its stake in the FAW partnership to 49% from 40%.
