Volkswagen's Investment in Taiwan May be Finalized in October

Taipei, Sept. 15, 2011 (CENS)--Volkswagen's investment project for Taiwan is expected to be finalized in October, according to insiders familiar with its progress, with Taikoo-Beldare, VW's local agent, refusing to comment by saying that all announcements must be from the German headquarters.

The sources say the Taiwan Cabinet originally preferred locating the VW plant in the Changhua Costal Industrial Park in central Taiwan, which the German headquarters rejected due to the salt content in the air being unfavorable for engine production.

Some industry insiders say that VW will not invest in local production but only offer technical support, with Taikoo-Beldare to finance the works initially.

Some 10,000 VWs are sold in Taiwan annually, so a VW plant on the island has to serve more than the local market but also Southeast Asia, say the sources.

In the past two years or so, VW has invested sizably to expand capacity in China, which only meets local demand. With quality and cost-competitive auto parts made on the island, industry sources say that Taiwan might yet become VW's regional auto production base in Asia.

Other sources say the German headquarters may hire senior managers of Taikoo-Beldare to work for the future VW branch on the island; while rumors are that VW might contract Yulon Motor Co., maker of Nissans, Luxgens, tobes etc., to assemble the Polo, Lupo and commercial vehicles initially.