German auto giant Volkswagen AG will continue to bring new products into its two Chinese joint ventures -- Shanghai Volkswagen and FAW (First Automotive Works) Volkswagen -- to expand its market presence in the country, according to a top executive of the company.
Ferdinand Piech, chairman of Volkswagen Group, said the move was at the core of the company's strategy in China because the country would be one of the fastest growing auto markets in the world.
Volkswagen AG now controls about half of the Chinese car market.
Piech made the remarks Thursday during a ceremony marking the off-line of the company's Bora, a mid-sized sedan, in FAW Volkswagen and the 10th anniversary of the joint venture.
"The launch of Bora in FAW Volkswagen is a substantial step towards our China strategy,'' he said.
Bora will come with 1.6 and 1.8-litre gasoline engines and 1.9-litre diesel engines.
Zhou Yongjiang, vice-president of FAW Volkswagen, said Thursday that prices for the Bora would run between 170,000 yuan (US$20,490) and 230,000 yuan (US$27,710).
The price range is higher than that of the Jetta (also produced by FAW Volkswagen) but lower than that of the Passat (made by Shanghai Volkswagen).
"Bora will be launched on the market at the end of this year and the beginning of next year,'' Zhou said.
He said FAW Volkswagen plans to produce 50,000 Boras next year.
Piech said Volkswagen AG would continue to invest in China.
The company has planned to add a total investment of about US$1.5 billion in FAW Volkswagen and Shanghai Volkswagen over the next five years.
Volkswagen AG will launch a compact car, Polo, in Shanghai at the end of this year.
Shanghai Volkswagen also produces Santana sedans.
Analysts say Volkswagen AG faces increasing competition on the Chinese market because almost all of the world's auto giants, including General Motors, Ford, Toyota and Citroen have already set up auto joint ventures in the country.
Volkswagen AG and FAW have invested about 14 billion yuan (US$1.69 billion) in FAW Volkswagen since its establishment in 1991.
Currently, FAW Volkswagen makes up 18 percent of the Chinese sedan market. During the past 10 years, it produced Jetta 400,000 units, a popular model among Chinese private consumers and taxi companies, and 50,000 units of Audi, one of the top foreign luxury models produced in China.
The joint venture has established an annual production capacity of 150,000 units.
(China Daily 08/24/2001)