The plant in Changsha, southern China is being run by the Shanghai-Volkswagen (SVW) joint venture and will initially produce the Volkswagen Lavida four-door compact sedan for the domestic market, with other VW and Skoda models to follow. The total capacity of the plant is about 300,000 vehicles per year.

“China is not only the Volkswagen Group’s largest and most important market; it has also become the Group’s second home market. We intend to develop the entire country as a company with local roots,” said Prof Dr Jochem Heizmann. “The plant in Changsha is a key step in our “Go South” strategy in China. This new facility will bring us nearer to our Chinese customers and also improve the quality of our supply chain.”

Production at the Changsha vehicle plant will be carbon-neutral, with solar facilities at generating more than 10,000 MWh of environmentally compatible power. Further power is generated by local hydroelectric plants.

Last year saw Volkswagen, together with its two joint ventures FAW-Volkswagen and Shanghai-Volkswagen, deliver a around 3.7 million vehicles to customers in China, representing an increase of 12.4% over the previous year. With its partners, the Volkswagen Group will be investing more than €22bn in China by 2019.