VW building auto parts plant in northeast China
SHANGHAI/HONGKONG (Reuters) - European auto maker Volkswagen AG (VOWG.DE: Quote, Profile, Research) said on Monday it is building a new gearbox plant in northeast China to supply its local car manufacturing joint ventures.
The facility, based in the city of Dalian and expected to start operation in 2010, will mainly supply its ventures with Chinese automakers FAW Group and SAIC Motor (600104.SS: Quote, Profile, Research), a Volkswagen spokesman in China said.
He declined to provide further details.
Dalian mayor Xia Deren told Reuters late last week that the project, costing roughly 200 million to 300 million euros ($300-460 million), would have a designed annual capacity of 300,000 units.
Volkswagen competes with General Motors Corp (GM.N: Quote, Profile, Research) and other global automakers in China, where its Audi and Passat sedans have seen rapid sales growth.
Its vehicle sales in mainland China and Hong Kong rose 28 percent to 910,491 units in 2007, surpassing its target of 900,000 units.
($1=.6578 Euro)
(Reporting Fang Yan and Alison Leung; Editing by Edmund Klamann)
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