India, Russia vital for Volkswagen's future
NEW DELHI (Reuters) - Germany's Volkswagen sees growing markets like India and Russia as vital for its long-term future and aims to produce up to 110,000 vehicles a year from 2009 in India, a company official said on Wednesday.
But chasing new opportunities would not be at the expense of jobs in Europe, Hans Dieter Poetsch, Volkswagen's chief financial officer, told reporters in New Delhi.
"Volkswagen is going through a difficult phase in Western Europe, as automobile markets there are largely saturated," he said.
Targetting fast-growing markets "is the only way to make sure the entire company has a good economic foundation and the only way to safeguard the long-term future of the Volkswagen Group," he added.
The company signed an agreement with the government of Maharashtra to build a $530 million factory in Pune.
It will also design a new car loosely based on its Polo model but tailored to the $7 billion-plus Indian auto market, which Volkswagen expects to more than triple to annual sales of 3.5 million units within the next decade.
Volkswagen's Passat model will be produced from mid-2007 at its plant in Aurangabad, currently dedicated to making cars for Skoda, its Czech unit.
In India, the German giant has to compete with the small, cheap cars built by market leader Maruti Udyog Ltd. -- 54.2 percent owned by Japan's Suzuki Motor Corp -- and those of South Korea's Hyundai Motor Co. and Tata Motors.
Poetsch would not comment on recent reports he was likely to be forced out of the company when his contract expires next year.
But he did stress that expansion in emerging markets would "strengthen" the jobs of its unionised European workforce.
"Some of the components and models used and sold in these two countries (India and Russia) will be imported from Germany, and thus help safeguard jobs in Germany too."
Volkswagen said last week it planned to stop making its best-selling Golf at its Brussels plant to cut costs, reducing the factory's staff from 4,900 to 1,500.
But it later suggested it may build 100,000 units of the small Audi car at the plant from 2009.
But chasing new opportunities would not be at the expense of jobs in Europe, Hans Dieter Poetsch, Volkswagen's chief financial officer, told reporters in New Delhi.
"Volkswagen is going through a difficult phase in Western Europe, as automobile markets there are largely saturated," he said.
Targetting fast-growing markets "is the only way to make sure the entire company has a good economic foundation and the only way to safeguard the long-term future of the Volkswagen Group," he added.
The company signed an agreement with the government of Maharashtra to build a $530 million factory in Pune.
It will also design a new car loosely based on its Polo model but tailored to the $7 billion-plus Indian auto market, which Volkswagen expects to more than triple to annual sales of 3.5 million units within the next decade.
Volkswagen's Passat model will be produced from mid-2007 at its plant in Aurangabad, currently dedicated to making cars for Skoda, its Czech unit.
In India, the German giant has to compete with the small, cheap cars built by market leader Maruti Udyog Ltd. -- 54.2 percent owned by Japan's Suzuki Motor Corp -- and those of South Korea's Hyundai Motor Co. and Tata Motors.
Poetsch would not comment on recent reports he was likely to be forced out of the company when his contract expires next year.
But he did stress that expansion in emerging markets would "strengthen" the jobs of its unionised European workforce.
"Some of the components and models used and sold in these two countries (India and Russia) will be imported from Germany, and thus help safeguard jobs in Germany too."
Volkswagen said last week it planned to stop making its best-selling Golf at its Brussels plant to cut costs, reducing the factory's staff from 4,900 to 1,500.
But it later suggested it may build 100,000 units of the small Audi car at the plant from 2009.
Source : Reuters
posted by anandsonline @ Thursday, November 30, 2006
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