Volkswagen is already the top foreign automotive investor in Russia, representing five brands: Volkswagen; Skoda; Audi; Seat and Volkswagen commercial vehicles. Rencently, however, Volkswagen’s management board member Michael Macht, announced a further €840-million for expansion.
While Volkswagen’s worldwide spending for the next three years will total €16.7-billion, Macht says that Russia “will get additional €840 million” in addition to the €1-billion already invested. Around €250-million will go towards establishing a new engine plant in Kaluga, which is planned to open in 2015 and will produce an estimated 150 000 engines per year. “The new engine plant at Kaluga will add the highly advanced component technology required by our local production capacities, thus strengthening our position on the Russian market”, said Macht.
Part of the investment will also be put towards developing Volkswagen’s production facility in the city of Nizhniy Novgorod. Together with the GAZ Group, a leader in Russian commercial vehicles, Volkswagen plans to produce 110 000 passenger cars in Nizhniy Novgorod in 2015.
The Russian market is currently the sixth largest market for Volkswagen vehicles and the company has identified Russia as its primary strategic growth market in Europe. By 2018 the German manufacturer aims to sell half a million vehicles in Russia on an annual basis. Currently, Volkswagen are on target to sell 315 000 cars in Russia this year, a massive 38 percent increase compared to 2011.
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