VW Invests Big in Engine/Plant

The three gentlemen in the accompanying picture are (from left) Hubert Waltl, member of the Volkswagen brand board of management responsible for production: Juan Manuel Oliva Raminéz, Governor of the state of Guanajuato; and Otto Lindner, Chairman of Volkswagen de México.

The three gentlemen in the accompanying picture are (from left) Hubert Waltl, member of the Volkswagen brand board of management responsible for production: Juan Manuel Oliva Raminéz, Governor of the state of Guanajuato; and Otto Lindner, Chairman of Volkswagen de México. They are posed by that engine because Volkswagen has just launched construction of a new engine plant in Silao, which, when complete in 2013, will have the capacity to build 330,000 engines per year.

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The engine plant will supply assembly plants in both Puebla, Mexico—where the Jetta, Golf Estate, and New Beetle are presently produced—and the brand-new assembly plant in Chattanooga, Tennessee, where the new Passat, developed specifically for the U.S. market, is presently ramping toward production.

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According to VW, the investment for developing the engine and building the plant is on the order of $550-million. So whether you’re thinking pesos, Euros, or dollars, that’s a sizeable outlay.