VW can start work on 2b yuan plant in Xinjiang, regulator says

PUBLISHED : Wednesday, 07 December, 2011, 12:00am
UPDATED : Wednesday, 07 December, 2011, 12:00am


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Shanghai Volkswagen Automotive has received approval to start work on a two billion yuan (HK$2.4 billion) passenger car plant in northwestern Xinjiang, according to a government industry regulator.

In what would likely be the farthest-flung production base for a foreign carmaker in China, Shanghai VW received approval from the National Development and Reform Commission for a planned facility in Urumqi's economic-development zone, with an initial annual capacity of 50,000 sub-compact passenger cars per year, a statement posted this week on the website of the NDRC's Xinjiang branch said.

The plans have not been confirmed by the company, but would mark yet another ambitious step in the German car giant's nationwide ramp-up of production capacity.

VW announced last week that its new Euro520 million (HK$5,425 million) plant under construction in Foshan would produce the Audi A3. The facility is the group's first in southern China and the first production base of joint-venture FAW-Audi outside its main plant in northeastern Changchun, Jilin.

Meanwhile, the Shanghai VW joint venture is building a plant in Yizheng, in eastern Jiangsu province.

The Foshan and Yizheng plants will each have the capacity to produce 300,000 cars per year and are set to come online in 2013.

The statement said the much smaller Xinjiang plant was also targeting 2013 for a production launch.

The VW group previously announced it intended to invest Euro10.6 billion in China between this year and 2015.