VW says to build new Chinese auto plant

FRANKFURT: Europe's biggest automaker Volkswagen said on Thursday it intends to build a factory in Yizheng, eastern China, to boost production capacity in China, the world's biggest car market.

The plant should be up and running by 2013 and turn out 300,000 vehicles when fully operational, the firm said.

"China is one of the most important automotive markets of the future and a dynamic growth driver for the Volkswagen Group," VW group production director Jochem Heizmann said in a statement.

"Together with our Chinese partners, we plan to double our production capacity to three million vehicles by 2013-14," he added.

The Yizheng plant is backed by The Volkswagen Group China and a local partner, Shanghai Volkswagen.

In June, VW signed a contract with its partner FAW-Volkswagen to build another plant in Foshan, near Guangzhou, with similar production capacity.

In April, VW announced it would boost its Chinese investment programme by 1.6 billion euros ($2.0 billion) to a total six billion euros.

The German group delivered more than 950,000 cars in China, the world's biggest auto market, in the first half of the year, an increase of 45.7 per cent over the the level in 2009, which was a record year for VW.

VW aims to overtake Japan's Toyota as the world's biggest automaker by 2018.