VW, FAW begin construction on 5th China assembly plant despite slacking sales
Volkswagen Group, despite a slowdown in industry sales, is pressing ahead with plans to add capacity in China by starting construction on a vehicle assembly plant in the east China port city of Qingdao on Monday.
The 1.4 billion yuan ($226 million) factory is scheduled to start production in July 2017, the Qingdao municipal government said on its website.
The plant, with annual capacity of 300,000 vehicles at peak output, will mainly build Volkswagen-brand SUVs and sedans, according to the government.
The Qingdao factory will be operated by FAW-Volkswagen Automobile Co., a 60-40 joint venture between China FAW Group Corp. and Volkswagen Group.
It will be FAW-VW's fifth plant. The joint venture now operates two factories in the northeast China city of Changchun, one in the southwest China city of Chengdu and one in the south China city of Foshan.
Volkswagen also has a joint venture with SAIC Motor Corp., which operates five assembly plants across China.
Volkswagen Group's China sales dropped nearly 17 percent year on year to 250,000 vehicles in June as the country's slowing economy continued to hamper foreign mass-market brands. It marked the first time in 10 years that the company's China sales fell in the first half of a year.
In the first six months, Volkswagen Group sold 1.74 million vehicles in China, a decline of 3.9 percent from a year earlier.
The plant, with annual capacity of 300,000 vehicles at peak output, will mainly build Volkswagen-brand SUVs and sedans, according to the government.
The Qingdao factory will be operated by FAW-Volkswagen Automobile Co., a 60-40 joint venture between China FAW Group Corp. and Volkswagen Group.
It will be FAW-VW's fifth plant. The joint venture now operates two factories in the northeast China city of Changchun, one in the southwest China city of Chengdu and one in the south China city of Foshan.
Volkswagen also has a joint venture with SAIC Motor Corp., which operates five assembly plants across China.
Volkswagen Group's China sales dropped nearly 17 percent year on year to 250,000 vehicles in June as the country's slowing economy continued to hamper foreign mass-market brands. It marked the first time in 10 years that the company's China sales fell in the first half of a year.
In the first six months, Volkswagen Group sold 1.74 million vehicles in China, a decline of 3.9 percent from a year earlier.
