Volkswagen vows it remains bullish on China despite continued high taxes, a rumoured plant closure and the sudden departure of a senior executive who guided the German car giant's initial mainland investment. VW Group China president Erich Schmitt said yesterday the firm was confident there would be 'tremendous growth in the future'. 'I think we are now in a phase of seeing a little bit more realistic assessment of the situation in China,' Mr Schmitt said. 'We have to cope with problems, but we will find solutions. 'As in all other countries, the car industry is the pillar for everything.' VW executives, in Beijing for a conference on car emissions, offered little comment on the departure of former Asia-Pacific operations chief Martin Posth last month. The car-maker has repeatedly declined comment on the reason for his departure. Mr Schmitt insisted VW's performance in China had no bearing on changes at the car-maker's executive offices. 'There was no connection - no, I don't think so,' Mr Schmitt said. VW, China's largest joint-venture car-maker, intends that its production of Shanghai-made Santana cars reach a record 230,000 units this year, a 15 per cent increase over 1996 output. 'All our cars are sold,' Mr Schmitt said. 'In fact, we have too few cars in stock.' Company officials said production of Jettas at a second joint-venture plant, First Automotive Works-VW in Changchun, was supposed to reach a maximum 40,000 cars this year - about a quarter of the plant's capacity. FAW-VW has denied reports in German media that the Changchun plant is scheduled for closure due to slack production and heavy losses. 'We are satisfied with our production capacity we have so far and the utilisation of our capacity,' Mr Schmitt said. VW's China director said that while China continued to impose heavy taxes on retail sales of passenger cars, the car-maker 'can live with the current situation'. 'It would be nice, always, to get the taxes down, but this is reality,' he said. China levies myriad state and local luxury taxes on motorists, including a 17 per cent value-added tax, 10 per cent federal sales tax, 8 per cent consumption tax, local 'institutional purchase control' charges of up to 35 per cent and five-figure luxury taxes.