Volkswagen to increase production capacity in China following increased demand

China is Volkswagen’s biggest sales region and has been a major driver both for company sales and profits in the last year. It is due to this increased demand that the company had decided to increase production capacities within the country in the coming five to six years. Volkswagen hopes to increase production in China by four million by 2018 as compared to the existing 3 million capacity for 2014.

Volkswagen, Europe’s leading auto manufacturers announced this new target for 2018 on June 2 while unveiling a new management department for China under Heizmann leadership.

During 2011 fiscal, Volkswagen delivered 2.3 million vehicles to China, up 17.6% as compared to the previous year and reported a pro rata operating profit of €2.6 billion, thereby declaring that China was the company’s biggest market even ahead of Germany. Volkswagen presently has a product range of 60 models in China from its Volkswagen passenger cars, Audi and Skoda brands and Lamborghini and Bentley.

Volkswagen Group has ten production facilities operating in China both were production and component plants are concerned. More such locations will be added in the coming years as a part of the Group’s long term strategy. Investment plans too are being looked into with the Group planning investments to the tune of €14.0 billion by end of 2016.