VW and FAW to Invest €2 Billion in Two New Assembly Plants in China

It appears that Volkswagen Group is opening assembly plants in China on a yearly basis. The automaker has announced it will build two new vehicle plants in the cities of Qinqdao and Tianjin, for which it will allocate €2 billion ($2.72 billion) together with its joint venture partner FAW.

At a ceremony attended by German Chancellor Angela Merkel and Chinese Premier Li Keqiang, Prof. Dr. Jochem Heizmann, President and CEO of Volkswagen Group China, andXu Jianyi, Chairman of FAW, today signed a joint declaration for two new vehicle plants in China.

“China has become our largest and most important market. To satisfy the demands of our customers in the country, we are engaging in a further substantial expansion of our capacities in China together with our Chinese partner FAW Volkswagen,” said VW CEO Prof. Dr. Martin Winterkorn, also present at the signing of the declaration.

The two new vehicle plants will be built step-by-step on the East coast of China in the cities of Qingdao in Shandong Province and Tianjin. The two locations were chosen together with the joint venture partner FAW, with the key site factors being high qualification levels and the infrastructure available.

Furthermore, Tianjin is also the location of a new production plant for dual-clutch gearboxes (DSG) for Volkswagen in China that is scheduled to start production at the end of 2014.

VW didn’t say which models will be built in the new plants. The German carmaker has been present on the Chinese market for 30 years. Together with its two joint ventures FAW-Volkswagen and Shanghai-Volkswagen, VW Group delivered about 1.51 million vehicles between January and May 2014, accounting for an increase of 17.7 percent compared with the same period last year.

By Dan Mihalascu



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