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Volkswagen investing €560M in Argentina plant for new MQB-based SUV

Volkswagen is investing some €560 million (US$652 million) over the next five years in the production of a new MQB-based SUV in Pacheco, Argentina. From 2020, the plant will deliver the new model built in Argentina to the entire South American continent. The new vehicle project will create some 2,500 jobs.

Under its Transform 2025+ future strategy, Volkswagen is taking measures to successfully realign business on world markets. The brand is increasingly delegating responsibilities previously controlled centrally from Wolfsburg to the regions. Going forward, the regions will hold full responsibility for the entire scope of business activities—right through to decisions relating to the model range. In addition to South America, responsibilities have also been delegated to the regions of North America, China and the Sub-Saharan area of Africa.

The new vehicle project in Argentina is a part of the Volkswagen brand’s largest product offensive in the South America region. The design, size and equipment of the SUV planned for 2020 and based on MQB technology are targeted to appeal to a broad customer base.

The modernization measures under the investment plans will optimize the manufacturing process and thus enhance both quality and sustainability in production in preparation for start of production at the Pacheco plant in 2020.

Volkswagen has launched the largest product offensive in its history in South America: 20 new models based on the Modular Transverse Toolkit (MQB), including a totally revamped pickup range and further locally-built SUVs, will be launched in the region by 2020.

Assuming a positive overall market trend, the company expects to move back into the black in South America by 2020. Currently, there is a significant increase in deliveries in the region. Some 36,000 vehicles were handed over to customers from January to October—an increase of more than 60% compared with the same period last year. Key drivers behind this positive development are Brazil and Argentina. Growth in the small car segment, which includes the Gol and Voyage, in these markets is particularly strong.

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