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VW targets Toyota with €51 billion in investments

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VW targets Toyota with €51 billion in investments
Photo: DPA
15:21 CET+01:00
German automaker Volkswagen will invest more than €50 billion in new and improved models over the next five years in a bid to unseat Toyota as the world leader in car manufacturing.

Most of the investment will be pumped into German plants, the firm announced Friday, and will focus on the development of hybrid and electric vehicles.

Of the €41.3 billion in spending on fixed assets, some 57 percent will flow into German production. Of the development investment for new or improved models, totalling more than €10.3 billion, the largest chunk will go to Germany, where most of the firm's vehicles are engineered.

The €51.6 billion investment is part of an ambitious growth plan drawn up by VW chairman Martin Winterkorn to usurp Toyota's position as the world's top automaker by 2018.

“The Volkswagen company will help shape technological change in the auto industry in decisive places and invest further in environmentally friendly technology, efficient engines and new models,” Winterkorn said.

With new plants in Russia, India and the United States, the Wolfsburg-based company aims to open up underdeveloped markets.

It hopes to lift its worldwide sales from 6.3 million vehicles in 2009 to more than 10 million by 2018. Toyota sold 7.8 million vehicles in 2009. By the end of October 2010, VW had shifted just short of 6 million units – a rise of 12.4 percent on the same time last year.

Some of the investment projects are already known. Workers' committee head Bernd Osterloh said €400 million would be pumped into production of the Tiguan compact crossover vehicle (CUV) at the Wolfsburg plant and transmission development at the Kassel site. VW plans to raise the daily production capacity of the Tiguan from the current 750 units a day to 1,000 units.

Production of the new pick-up utility, the Amarok, will begin in Hannover, with the expectation that up to 40,000 of the sturdy vehicles will be made by the middle of 2012.

DAPD/The Local/dw

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