Volkswagen intends to double engine production in Russia

Volkswagen intends to double engine production in Russia


 

Kommersant.- Volkswagen has revealed the conditions of the SPIC, through which it plans to increase engine production in Russia. RIA Novosti has reported, quoting the head of the company in Russia: Marcus Ozegovich that Volkswagen intends to localise a 1.4 liter turbo engine within the conditions of the SPIC. There are plans to increase the production of a 1.6 liter engine alongside the aforementioned project, for the purpose of worldwide exports. The 1.6 liter engines, which comply with Euro-5 standards, are currently manufactured in 90 and 110 hp versions. 11 models of the company are equipped with these engines, including three Russian production models – VW Polo, Skoda Rapid and Skoda Octavia.

Volkswagen already exports engines manufactured in Kaluga. 44,000 out of the total production figure of 161,000 engines have been exported in 2018. Factories in Spain and Chile were amongst the export destinations. The company plans to export engines to Czech Republic, Poland, Spain, Mexico and South Africa from Russia in 2019.

As reported by Kommersant, the Ministry of Industry and Commerce has estimated Volkswagen’s investment amount within the framework of the SPIC as approximately 12 billion rubles. VW, on the other hand, has announced its intention to invest 40 billion rubles under the investment contract. The ministry has stated that the company has already localised engine production, alongside negotiations on the possibility of the localisation of transmissions and gearboxes. In general, this is the standard requirement of the Ministry of Industry and Commerce from car manufacturers during SPIC negotiations. However, concerning the localisation of gearboxes or transmissions, VW has stated that the conditions are still being discussed and the company is ready to consider various options, but the production of transmissions does not seem to be economically viable under the current circumstances.