Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Volkswagen-SAIC JV to revamp Shanghai plants to make Audi sedans: government document

Published 07/14/2020, 01:55 AM
Updated 07/14/2020, 02:00 AM
© Reuters.

© Reuters.

By Yilei Sun and Brenda Goh

BEIJING (Reuters) - Volkswagen AG (DE:VOWG_p) and its Chinese joint venture partner SAIC Motor (SS:600104) plan to invest 4.13 billion yuan ($590 million) to revamp their car plants in Shanghai to make new Audi sedans, according to a government document seen by Reuters.

SAIC Volkswagen, the joint venture (JV) of Wolfsburg-based automaker and China's biggest automaker, currently only sells cars under the Volkswagen and Skoda marques. Audi is Volkswagen's luxury car unit.

With the revamp at its Shanghai plants, the JV is aiming for an annual manufacturing capacity of 60,000 Audi (DE:NSUG) A7L sedans and 60,000 new Volkswagen sport-utility vehicles. The total capacity at the plants will remain unchanged.

The revamp, expected to be done by the end 2020, comes as demand for luxury cars in China remained firm even as sales in the world's biggest auto market slumped over the past two years.

SAIC Chairman Chen Hong has previously said the JV plans to roll out the first Audi product in early 2022.

The Audi manufacturing will also use printing facilities at the JV's newly built MEB platform, a Volkswagen platform that enables efficient production of various electric vehicle models.

Volkswagen hopes to start production based on its MEB platform in Shanghai from the fourth quarter and has sought government nod for production of its electric ID.4 vehicles.

Audi China said its project with SAIC was proceeding according to plan, without giving any more details. SAIC did not immediately reply to a request for comment.

SAIC Volkswagen's sales fell 37% from a year ago to 577,385 vehicles in the first half of 2020 as the coronavirus pandemic hit demand in China, while total industry sales fell 17%. The JV sold 2 million cars last year.

Audi also has a long-term collaboration with FAW Group [SASACJ.UL] in China to build all its cars in the northeastern city of Changchun and southern city of Foshan.

© Reuters. The logo of German carmaker Volkswagen is seen on a rim cap in a showroom of a Volkswagen car dealer in Brussels

($1 = 7.0055 Chinese yuan)

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.