Volkswagen Sees Slovak Plant Operating at Full Capacity in 2013

Volkswagen AG (VOW)’s assembly factory in Slovakia will continue operating at full capacity throughout next year as demand for new models produced in the country outweighs the euro-area slowdown, a company official said.

The factory will keep the target of assembling more than 400,000 vehicles in 2012 and the outlook for the next year is at a “very similar” level, the unit’s Chief Executive Officer Albrecht Reimold told reporters in Bratislava, the Slovak capital, today.

Europe’s largest carmaker is boosting output in Slovakia, seeking to benefit from the country’s euro adoption combined with lower labor costs than in western Europe. The company plans to invest 1.5 billion euros ($1.9 billion) in expansion of the Slovak facilities in the coming five years, including a 600 million-euro body shop whose construction has already begun.

European car sales dropped an annual 8.4 percent in May, the eighth consecutive decline, led by France’s PSA Peugeot Citroen and Renault SA (RNO), as consumers held off purchases on concern over the slowing economy, according to the European Automobile Manufacturers’ Association. Volkswagen’s European sales declined 5.5 percent.

Volkswagen in Slovakia makes Touareg and Audi-brand Q7 SUVs, as well as bodies for Porsche Cayenne. Last year it started to produce exclusively in Bratislava the so-called New Small Family line of cars, made for Volkswagen, Seat and Skoda brands. The planned increase in volume from about 210,000 cars made in 2011 is due mainly to new sub-compact models.

To contact the reporter on this story: Radoslav Tomek in Bratislava at rtomek@bloomberg.net

To contact the editor responsible for this story: James M. Gomez at jagomez@bloomberg.net

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