Volkswagen’s joint venture with SAIC Motor – Shanghai Volkswagen – has begun production at its newest plant in China, located at Urumqi in the western region of Xinjiang. It is the first vehicle plant in the region.
The carmaker has started production at the plant with the new Santana model, which will be assembled from semi-knocked down (SKD) kits. Volkswagen would not comment on which plant was supplying the kits, other than to say they would be supplied by another plant in China. Neither did it reveal what the initial output volumes would be from Urumqi, though it did confirm that output would rise to 50,000 in 2014 upon completion of the body and paint shops.
The company has sold around 4m Santana models in China since it was introduced in the mid-1980s. The new model was launched in October last year at the company’s Wolfsburg plant in Germany, at which VW announced that production of the model for the Chinese market would be based in China.
Shanghai Volkswagen has three other plants in the country, at Shanghai, Nanjing and Yizheng. It also has plans for a fifth plant at Changsha, in the southern part of Central China, to be ready for production at the end of 2015. The company said it expected a strong growth in gross domestic product in western China over the coming years, and a corresponding rise in purchasing power. It added that growth momentum in the east of the country had to some extent returned to normal.
“Our vehicle plant in Urumqi provides sustainable impetus for economic and social development in the region, and allows us to benefit from expected growth in Western China,” said professor Dr Jochem Heizmann, president and CEO of Volkswagen Group China.
China is VW’s largest automotive market. In 2012 it delivered more than 2.81m vehicles to customers there. Deliveries in the first seven months of this year rose by 18.5% compared with the same period in the previous year, to reach 1.79m.
Pictured left to right: Prof. Dr Heizmann, president and CEO of Volkswagen Group China, Shi Dagang, representative Xinjiang Province, Hu Maoyuan, chairman of the board of Shanghai Automotive Group Corporation, SAIC, Yilihamu Sha Bi Er, representative Xinjiang Province.
