VW Confirms €4 Billion Investment in China this Year

Volkswagen AG says it plans to invest more than €4 billion ($4.5 billion) for new models in China this year.

The announcement confirms that the group’s ambitious expansion plans in China have been spared widespread cost-cutting elsewhere. VW has been bracing since last September for the economic impact of repairs and regulatory fines relating to 11 million diesels it admits it rigged to elude emission tests. The company’s namesake brand alone is targeting cuts of €1 billion or more.

VW said previously it aims to introduce 15 new-energy models in China over the next five years. Jochem Hiezmann, who heads the group’s China unit, tells reporters the first of those new models—a locally produced plug-in hybrid version of the Audi A6 midsize sedan—will debut in the second half of this year.

That car will be followed by multiple hybrid and electric models, along with conventionally powered cars and SUV/crossovers. Heizmann affirms VW also will launch 10 new locally produced SUVs in China over the next four years.