VW plans new Chinese auto factory

FRANKFURT: The European automaker Volkswagen will build a new factory in southern China as part of a long term strategy in what is now VW's most important market, it said on Wednesday.

Chairman Martin Winterkorn, who signed the contract to build a factory in Foshan, near Guangzhou, said: "With our unprecedented investment program, we intend to double our capacities in China to three million vehicles per year by 2013/14."

VW and its partner FAW-Volkswagen plan to invest about 520 million euros (620 million dollars) in the Foshan plant, which is designed to produce 300,000 vehicles per year from mid 2013 and employ about 4,000 people.

The biggest European car company, along with FAW-Volkswagen and another partner, Shanghai Volkswagen, have a total of nine plants in China and make around 20 Audi, Skoda and VW models there, a statement said.

In April, VW said it would boost its investment programme for China by 1.6 billion euros to a total six billion.

The group plans to begin making electric cars there in 2013/2014, the statement said.