Volkswagen To Ramp Up China Investment, Build Two New Plants
April 26 2010 - 3:17AM
Dow Jones News
Volkswagen AG (VOW.XE) said Monday it will increase investment
in China by EUR1.6 billion to EUR6 billion and build two new plants
there, the latest sign of global automakers shifting their focus to
Asian growth markets.
"The growth of the Chinese market exceeds all expectations,"
Volkswagen Chief Executive Martin Winterkorn said in a statement,
adding that the additional investment should pave the way for the
further expansion.
Volkswagen's global sales in the first quarter soared 25% from a
year earlier to 1.73 million vehicles, fueled mainly by booming
demand in China and Brazil. China alone accounted for 457,300
vehicle sales in the first three months of the year, up 61% from
the same period last year.
Volkswagen's large presence in China, which it gained partly
through an early market entry in 1984 as the first Western auto
maker, along with a relatively small exposure to the U.S. market
downturn last year, helped it to steer through the industry gloom
better than most of its international rivals.
Europe's largest automaker by sales operates two joint ventures
in China, Shanghai Volkswagen Automotive Co. and FAW-Volkswagen
Co., with Volkswagen owning a 50% stake in the SVW joint venture
and a 40% stake in FAW-VW.
-By Christoph Rauwald, Dow Jones Newswires; +49 69 29 725 512;
christoph.rauwald@dowjones.com
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