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New in North America: The Silao plant

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| Posted January 29th, 2013

New in North America: The Silao plant

EXPANDING ITS MARKET POSITION IN NORTH AMERICA IS A KEY BUILDING BLOCK IN THE VOLKSWAGEN GROUP’S GROWTH STRATEGY. THE ENGINE PLANT JUST OPENED IN THE CENTRAL MEXICAN TOWN IN SILAO AND VEHICLES SUCH AS VOLKSWAGEN’S CROSSBLUE WHICH MADE THEIR DEBUT AT THE NORTH AMERICAN INTERNATIONAL AUTO SHOW (NAIAS) ARE TO PLAY AN IMPORTANT ROLE IN ACHIEVING THIS GOAL.

The Group’s 100th plant worldwide is located in Silao: The factory which was inaugurated last week will supply Volkswagen’s vehicle plants in Puebla and Chattanooga with state-of-the-art TSI engines produced locally. One day earlier, Group brands presented their latest models in Detroit. And on the eve of the auto show Martin Winterkorn, Rupert Stadler and Matthias Müller talked to more than 200 journalists about the significance of North America for the Group and about the brands’ strategies. Read on to find out more.

Future offensive

Some 400 guests from politics, industry and the Group along with representatives from the national and international media, and, of course, the plant’s employees were present at last Tuesday’s inauguration of Volkswagen’s new engine plant in Silao, Central Mexico. The modern and fuel-efficient TSI engines produced by the Group’s 100th plant worldwide are to drive the ambitious North America offensive further forward.

The inauguration ceremony was attended by the President of Mexico, Enrique Peña, the Governor of the state of Guanajuato, Miguel Marquez, and Martin Winterkorn, Chairman of the Board of Management of Volkswagen Aktiengesellschaft. The Silao factory represents one of the largest and most international production networks in the automotive industry. With this new plant Volkswagen will be driving its ambitious major North American offensive forward. Over the next three years the Volkswagen Group will be investing more than USD five billion in North America alone. Martin Winterkorn, Chairman of the Board of Management of Volkswagen Aktiengesellschaft, commented: “Silao is thus also a strong symbol of our uninterrupted growth trajectory and the Group’s continuing internationalization.”

Strengthening its market position in North America is an essential component of the Volkswagen Group’s global growth strategy. In this context, the company is planning annual sales of one million vehicles in the USA alone from 2018 based on models such as the Jetta, the Beetle and the new US Passat tailored to the demands of US customers which are produced at the North American plants with a high degree of localization.

With the start of engine production in Silao, Volkswagen is continuing its success story in Mexico that already spans almost 60 years. Along with the Volks - wagen plant in Puebla, the MAN commercial vehicles plant in Querétaro and the planned Audi vehicle plant in San José Chiapa scheduled to begin production in 2016, the Group remains a key growth driver for Mexican industry.

North American vehicle plants in Puebla und Chattanooga with the latest generation of fuel-efficient TSI engines. The plant is designed for a medium-term annual capacity of 330,000 units. Investment runs at USD 550 million. Volkswagen will be creating over 700 new jobs at the 60 hectare plant in Silao in the medium term. Further jobs in the region will also be created at suppliers and in the service sector. Engine production in Silao meets the high environmental standards of the Volkswagen brand’s “Think Blue. Factory” program. The aim of this program is to make more efficient use of resources and to achieve a sustained reduction in production-related emissions at all Volkswagen plants. As a result, all manufacturing equipment in Silao complies with the latest energy efficiency standards, thus achieving a significant reduction in the environmental impact of each produced engine. Special rooflights in the production halls, for example, combined with energy-efficient lighting throughout the facility ensure optimum natural light levels and simultaneously absorb the heat generated by the lighting system. The improved-performance TSI engines (EA 888) from Silao combine fuel economy and improved emissions with lower weight. The CEO of Volkswagen de México, Andreas Hinrichs, drew attention to the Mexican automotive industry’s growth path in 2012 and to Volkswagen’s contribution consisting of over 600,000 vehicles produced in the country. “For us, Silao is a big step towards the future. Volks agen is once again generating

strong momentum for growth and employment in the Mexican automotive industry.” Volkswagen de México currently builds four models for world markets at the Puebla plant. These are the Volkswagen Jetta, Golf Estate, Beetle and Beetle Cabrio. A total of 604,000 vehicles were manufactured in Puebla in 2012. The Volkswagen Group delivered about 165,000* vehicles to customers in Mexico in 2012. The Volkswagen Passenger Cars, Audi, SEAT, Porsche, Bentley and Volkswagen Commercial Vehicle brands therefore recorded a year-on-year rise of about 8 percent*. <*) including deliveries by the Porsche brand from August 1, 2012; excluding MAN and Scania, [...] January 15 was clearly a good day for the partnership between Volkswagen and Mexico. "Volkswagen de México" was founded 49 years ago today. A day that marked the beginning of a great success story.

And today we have added further momentum in the form of the new Silao Volkswagen plant – the Group's 3rd plant here in Mexico.

That on its own would be reason enough for a huge "fiesta". But it gets even better: Silao is also the Volkswagen Group's 100th plant worldwide. Or, as the employees here say proudly: planta numero uno cero cero. And that makes this plant a spectacular symbol:

• Of our uninterrupted growth.

• Of the continuing internationalization of our business.

• And of the grand ambitions that driveus at Volkswagen every day.

You can be assured that the entire world of Volkswagen is looking at Mexico today with pride and confidence!

I can clearly remember the decision to choose this location. And I have to say that this decision was easy to make.

• Because Mexico is the door to the important US car market.

• Because – despite all challenges – we have great confidence in this country and its people.

• And because Mexico has long been a firm and indispensable part of Volkswagen.

Puebla is the Group's second-largest plant – and therefore a bit like the "Wolfsburg of Latin America". MAN produces heavy trucks and buses in Querétaro. And a new large Audi plant will be completed in San José Chiapa by 2016.

Silao has already made Volkswagen a great deal more Mexican.

• We have invested more than half a billion US dollars here.

• We are creating more than 700 new qualified jobs here.

• And here we will build up to 330,000 highly efficient TSI engines per year.

We have made a conscious decision to rely on the highest standards in resource efficiency and environmental friendliness in Silao.

Volkswagen stands for the protection of the environment and climate – worldwide!

• That is why we are putting all our efforts into making our vehicles ever more efficient.

• And that is why we are breaking new ground in production, too, and vigorously reducing energy consumption and emissions.

As you can see, Volkswagen remains an engine for innovation and sustainable, healthy growth here in Mexico as well.

Today I want to thank all those who provided such strong support along the way:

• President Peña Nieto and the Mexican central government, whose commitment to stability and free trade has created the foundation for our commitment.

• The local authorities under governor Marquez, who have received us here in Silao with open arms.

• And of course Mr. Hinrichs, Mr. Klinge and the entire team, who in a great team effort have built this ultra-modern plant in only two years.

"Muchas Gracias" to you all! [...]

100 plants worldwide represent one of the largest and most international production networks in the automotive industry. The Volkswagen Group's global presence is a great competitive advantage.

• Because it provides us with a broad and solid position.

• Because we can thereby promote local value creation.

• And because it makes us less dependent on exchange rate risks and import restrictions.

At the same time, this global presence is simply part of our identity. We at Volkswagen want to be close to people, to their wishes, needs and dreams. And at the same time, we at Volkswagen want to take responsibility: for good work, for the future of the young generation, and for a sound environment.

I am absolutely certain this is the only way we can offer the best cars to our customers anywhere in the world while growing sustainably.

Silao is a good example. This new plant is a firm part of our major and ambitious push into North America. In the US alone, we want to sell more than one million vehicles per year by 2018. The majority of these vehicles will, in future, be driven by engines from Silao. Efficient, environmentally friendly and of the highest quality!

We thereby increase our degree of localization in the dollar area while providing additional thrust to our North America strategy.

• This benefits our customers in the region.

• It benefits Guanajuato and the automotive nation of Mexico as a whole.

• And of course, Volkswagen also benefits in the end. [...]

As you can see, our 100th plant is much more than just a new additional location. It also symbolizes how we at Volkswagen approach our business:

• Purposefully

• Sustainably

• And with a great deal of dedication to our cars, customers and employees!

In this spirit, I wish the team and the Silao plant all the best! I am happy that you are now part of the large global Volkswagen family.


tags ( Volkswagen, 2013, Silao, Mexico, Plant, 100th, Worldwide )