VW will introduce low-cost brand with FAW
Volkswagen Group plans to produce cars for a planned budget brand in China with joint-venture partner FAW Car Co., two people familiar with the matter said.
VW aims to introduce the new low-cost marque in three years and eventually may expand it to more than one model, the sources said.
Growth in China is crucial to VW's goal to be the world's biggest automaker by 2018. China, VW's top sales region, accounted for 31 percent of the German automaker's 9.2 million deliveries last year.
VW operates a second joint venture with SAIC Motor Corp., China's biggest car manufacturer.
"We want to bring a true budget car to the market in China in the foreseeable future -- a particularly affordable entry-level model for 6,000 euros to 7,000 euros (47,700 yuan to 55,700 yuan)," CEO Martin Winterkorn said at the company's annual meeting last month.
Company spokesman Eric Felber said there is nothing to report beyond the Winterkorn's April comments.
VW's rising deliveries in China, where it plans to build seven new factories, has helped the automaker cushion declining demand in Europe. The group is working to counter the market downturn in its home region by rolling out 60 new and updated models this year, including fresh versions of the Golf, Audi A3 and Skoda Octavia compacts.
VW's planned budget cars will compete with joint-venture brands launched by other global automakers -- such as GM's Baojun brand or Nissan's Venucia brand -- as well as domestic Chinese automakers.
Last November, Volkswagen agreed to extend its joint venture with FAW beyond 2016 and expand its product range. The joint venture started production of the Jetta model in the northeastern Chinese city of Changchun in 1991.
Growth in China is crucial to VW's goal to be the world's biggest automaker by 2018. China, VW's top sales region, accounted for 31 percent of the German automaker's 9.2 million deliveries last year.
VW operates a second joint venture with SAIC Motor Corp., China's biggest car manufacturer.
"We want to bring a true budget car to the market in China in the foreseeable future -- a particularly affordable entry-level model for 6,000 euros to 7,000 euros (47,700 yuan to 55,700 yuan)," CEO Martin Winterkorn said at the company's annual meeting last month.
Company spokesman Eric Felber said there is nothing to report beyond the Winterkorn's April comments.
VW's rising deliveries in China, where it plans to build seven new factories, has helped the automaker cushion declining demand in Europe. The group is working to counter the market downturn in its home region by rolling out 60 new and updated models this year, including fresh versions of the Golf, Audi A3 and Skoda Octavia compacts.
VW's planned budget cars will compete with joint-venture brands launched by other global automakers -- such as GM's Baojun brand or Nissan's Venucia brand -- as well as domestic Chinese automakers.
Last November, Volkswagen agreed to extend its joint venture with FAW beyond 2016 and expand its product range. The joint venture started production of the Jetta model in the northeastern Chinese city of Changchun in 1991.
