Volkswagen plans 10 billion-yuan factory in Changsha, Hunan
Provincial authorities seek feedback on plant to lift Volkswagen's China output by 10 per cent
Volkswagen, Europe's biggest carmaker, was seeking to build a 10 billion yuan (HK$12.4 billion) factory in China that might boost the company's production capacity by more than 10 per cent, state-affiliated bodies said.
The Hunan Research Academy of Environmental Sciences was seeking public feedback on the plant, which would be located in Changsha, the capital of Hunan province, and have a capacity to build 300,000 cars a year, the academy said on its website.
Investment in the factory might total 10 billion yuan, the Changsha National Economic and Technical Development Zone said on its website.
Getting lower-level bureaus to sign off on projects is among the first regulatory steps foreign companies must take before they receive Beijing's approval.
The factory would add to the estimated 2.38 million cars in annual capacity built up by Volkswagen's Chinese ventures, and the disclosures come at a time when a glut in China is forcing carmakers to lower prices.
"If Volkswagen asked me, I would say 'Don't build this plant', because you don't want to have overcapacity," Jochen Siebert, Shanghai-based managing director at JSC Automotive Consulting, said. "We have extreme competition already."
Volkswagen's spokeswoman in Beijing declined to comment.