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New Volkswagen Midsize SUV “Under Discussion”

Maker considering range of additional products, including Polo and Up! to support soaring U.S. sales.

by on May.30, 2012

VW Group CEO Jonathan Browning -- shown here at the 2012 Detroit Auto Show -- wants more product in the U.S. line-up.

With U.S. sales expected to increase by as much as 30% for May Volkswagen is looking at all its options to keep that momentum going – including the addition of all-new products to its American line-up.

The maker could start importing several models not currently sold in the U.S., said Volkswagen Group of American CEO Jonathan Browning.  But the executive says the more likely move would come with the addition of an all-new midsize SUV now “under discussion.”

“A midsize SUV would be a great opportunity for us,” Browning said following a speech to the Detroit Automotive Press Association.

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The vehicle would slot into the line-up between the compact Tiguan and the full-size Touareg sport-utility vehicles.  It might be developed as a joint project between the U.S. and “another region around the world,” Browning hinted, but he stressed that the American market would take the lead in the vehicle’s development.

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Audi Soon to Decide on U.S. Assembly Plant

May be essential for Audi's goal of doubling sales.

by on Jan.14, 2011

Audi will decide whether to build a U.S. assembly plant by year's end, says Jonathan Browning.

Audi is giving serious consideration to adding its own production plant in the United States as part of the Volkswagen subsidiary’s plan to double sales to 200,000 by 2018.

While the German marque has become one of the world’s largest luxury brands – in some markets now leading more established rivals like Mercedes-Benz and BMW – it has continued to lag in the U.S., where it never fully recovered from a safety scandal back in the late 1980s, despite having been cleared by federal regulators.

Jonathan Browning, the new CEO of the Volkswagen Group, the U.S. subsidiary of Volkswagen AG overseeing both the VW and Audi brands, says a decision on the American assembly plant will be made by the end of 2011.

That would finally wrap up an ongoing debate that has spanned more than a decade.  While both Benz and BMW now have major assembly operations in the U.S., Audi has resisted setting up a “transplant” assembly line, in part, because of the limited sales volumes it has achieved in the States.  But critics have argued that the maker is suffering from a chicken-and-egg syndrome and can’t build volume without the plant.

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Playing in favor of setting up a facility, lopsided dollar/Euro exchange rates have made it increasingly cost-prohibitive to import vehicles from Europe, especially smaller models like the popular A4.

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VW Signs Contracts for another Chinese Plant

Another 300,000 vehicles annually from Eastern China.

by on Jul.16, 2010

The biggest maker in China plans to get bigger.

The Volkswagen Group will build a new vehicle production plant in Jiangsu Province, China. The contracts were signed today by Prof. Dr. Jochem Heizmann, Member of the Board of Management of Volkswagen Aktiengesellschaft, and Dr. Winfried Vahland, President and CEO of Volkswagen Group China, together with representatives of Shanghai Volkswagen.

The plant in Yizheng, Eastern China, will start operating in 2013 and has a maximum annual production capacity of 300,000 vehicles.

VW is already the largest maker in China, and it will double production capacity there to 3 million vehicles by the end of 2014.

“China is one of the most important automotive markets of the future and a dynamic growth driver for the Volkswagen Group”, Heizmann said at the signing ceremony. “Together with our Chinese partners we plan to double our production capacity to three million vehicles by 2013/14.”

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Growth!

“With more than 950,000 vehicles delivered in the first half of 2010, Volkswagen Group China has exceeded deliveries in the record year of 2009 by 45.7 percent”, Vahland added. “This strong performance further confirms the success of our young and efficient model range. The new plant in Yizheng makes sure we will be able to meet growing demand from our Chinese customers in future, too.”

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Volkswagen to Build a New Plant in Southern China

Planned capacity of Foshan complex is 300,000 cars annually.

by on Jun.09, 2010

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"By 2013/2014, we intend to double our capacity in China to three million vehicles per year."

The Volkswagen Group is expanding its production in China, the world’s largest auto market.

Contracts for the construction of a new plant at Foshan, in the Southern Chinese region of Guangdong, were signed today by Prof. Dr. Martin Winterkorn, Chairman of the Management Board of Volkswagen, AG, and Dr. Winfried Vahland, President and CEO of VW Group China, together with representatives of the partner FAW-Volkswagen in Foshan.

FAW is a government owned automaker, and Chinese industrial policy requires joint ventures to gain access to a market that some experts say could easily reach 20 million units annually by the end of the decade. The U.S. auto market, once the world’s largest and once the source of enormous wealth and job creation, is languishing at 11 to 12 million units annually as the Great Recession and a jobless recovery continues.   (more…)

Volkswagen Group Profits Decline Sharply Even With the Sale of its Commercial Truck Business

Based on "extremely weak business" in the first quarter, a full year earnings decline is predicted.

by on Apr.22, 2009

A global footprint, strong sales in China and a fuel efficient lineup mean positive results.

No 'blue sky," but a global footprint, strong sales in China and an efficient line mean positive results.

In the face of a 21% overall decline in global vehicle demand, Volkswagen Aktiengesellschaft still managed to make an operating profit and increase its liquidity during the first quarter of fiscal year 2009.

The VW Group’s operating profit amounted to €312 million ($406 million) down from €1.3 billion ($1.7 billion) in the year earlier quarter. A loss was only prevented by the one-time sales of its Brazilian commercial vehicles business that contributed positively around €600 million to the results. Automotive net liquidity rose to €10.7 billion from €8.0 billion compared with the end of 2008.

“The Volkswagen Group, too, is not immune to the dramatic deterioration in the global business environment,” said the Chairman of the Board of Management, Doctor Martin Winterkorn, on Wednesday. The Group’s unit sales declined by approximately 16% in the first three months; production has been cut by around 25% and inventories reduced significantly as a result, he claimed.

“The strengths of our multi-brand Group prove themselves especially in difficult times: we have increased our global market share thanks to our young and environmentally friendly model range, and are in a sound financial position,” stressed Winterkorn. “Our goal for fiscal year 2009 remains to outperform the market as a whole and to gain additional market share.”

With its nine brands and what he calls a young model range, Winterkorn thinks the Volkswagen Group is well positioned. In 2009, the individual brands will again introduce numerous new and low-fuel consumption models that will further extend the Group’s product portfolio and cover new market segments. “For this reason, although we assume that the Volkswagen Group will be unable to escape the downward trend, we believe that it will perform better than the market as a whole and will be able to gain additional market share during the crisis” Winterkorn said.  (more…)