Volkswagen has said it would boost research and development capability at its Chinese joint ventures but has no plan to launch cars under the ventures’ own brands next year.

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Volkswagen, with links to FAW Group and SAIC Motor Corp since the early 1990s, has invested roughly $US400m to build up the ventures’ R&D facilities, a Chinese spokesman told Reuters.


The spokesman reportedly said more investment would be made to improve the JV’s R&D abilities developing new models catering to the Chinese market but a new car planned for a 2008 launch by Shanghai Volkswagen would not carry the venture’s own brand as stated by a local newspaper.


“The model is mainly designed in China by Shanghai Volkswagen, but it will still carry the Volkswagen brand,” he told Reuters.


The Shanghai Securities News reported on Friday that the venture would produce a car under its own brand next year, becoming the second foreign auto venture to unveil a strategy for its own brand, following the Guangzhou Honda JV in south China, the news agency said.

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The paper also said Shanghai Volkswagen’s new model might replace its Santana 3000, but the Volkswagen spokesman told Reuters it would have no effect on the Santana.


Volkswagen, which offers a mix of current and previous-generation models, was one of several key early players in the Chinese market but has suffered at the hands of newer arrivals. Nonetheless, it is fighting back  and last week raised its 2007 China sales target by 12.5% to 900,000 vehicles after reporting 30.2% sales growth in the first nine months in China and Hong Kong.


See also: BEIJING SHOW: Volkswagen premieres two new designed-for-China cars