VW says China sales may rise in line with auto market, explores new tie-up
Volkswagen AG expects its China sales may rise in line with the overall auto market this year, as it explores potential cooperation with domestic firm JAC Motors (600418.SS) in what could be a third partnership with Chinese automakers.
The head of the German firm's China business, Mr Jochem Heizmann, told reporters in Beijing that he expected China's total passenger car market will expand in line with, or perhaps even exceed, gross domestic product growth in the world's second-largest economy.
Mr Heizmann said that "If we look to the general growth situation, it's still tremendous, big growth," adding that there is potential for expansion in China's lower-tier cities despite the country's economy registering its weakest growth in a quarter century.
He said that "These are still cities with millions of inhabitants but in a different development stage."
The executive said VW will stick to existing investment plans for China, investing more than 4 billion euros ($4.46 billion) annually for the coming years.
VW's global business has come under increased scrutiny since it admitted last September it misled U.S. regulators about vehicle emissions. Sales in China, a stable source of revenue for VW for years and the carmaker's biggest market, fell 3.4 percent in 2015 before rebounding in January.
US rival General Motors Co's (GM.N) vehicle sales in China rose 5.2 percent last year, allowing it to overtake VW to claim the number one spot in the world's largest car market.
Source : Reuters