Porsche's Panamera production push spurs ???150 million Leipzig investment

Orange buildings show planned expansion. Click to enlarge.

Earlier today, we covered AutoWeek's latest report on the Porsche Panamera. This week, Porsche held the "topping out" ceremony for that car's new production facility in Leipzig. Part of a €150,000,000 expansion of the Leipzig plant, where the automaker already builds the Cayenne SUV, the Panamera facility is joined by a new logistics center, and the existing Cayenne manufacturing facility will be expanded to include, among other things, an apprentice workshop. That figure, according to the Automotive News, is a quarter more than initially planned.

According to Porsche, once all the work is completed, leipzig should be able to build up to 50,000 Cayannes and Panameras annually once the four-door GT's production line fires up in 2009. As for the Panamera, its engines will be manufactured at Stuttgart-Zuffenhausen and its painted chassis will come from VW's Hanover facility. Final assembly will take place in Leipzig. The new car also means that 600 new jobs will be required in Leipzig, and another 500 in Hanover. Porsche's announcement concludes by saying that the new Panamera facility's facades should be installed by the end of this summer, after which the automaker will be able to begin installing the production equipment.

Porsche's full press release can be found after the jump.

[Source: Porsche AG]

Porsche expands Leipzig plant for 150 million Euro

Stuttgart/Leipzig. Preparation for the production of the new Porsche model series Panamera is running at high speed: Today, Dr. Ing. h.c. F. Porsche AG, Stuttgart celebrated its topping out ceremony for the further expansion of its Leipzig plant. Among those present included German Federal Minister of Transport Wolfgang Tiefensee, the Minister President of Saxony Georg Milbradt, Leipzig's mayor Burkhard Jung and the Porsche Executive Board member Michael Macht as well as 300 guests and construction workers who together placed a garland on the roof of the new Panamera production facilities. With an area of 25,000 square meters, the facilities form the basis of the expansion. An adjacent logistics center with an area of 23,500 square meters has also been created. In addition, the existing assembly facilities, in which the Cayenne is already being manufactured, will be expanded to include a pilot and analysis center as well as an apprentice workshop. In total, investments for the buildings and production equipment amounted to 150 million Euro.

Michael Macht, Porsche AG Executive Board member responsible for Production and Logistics: "Since our decision for Leipzig in 1999, we have written a flawless success story. No one at Porsche doubts that this expansion was a good investment." Thanks to a well-polished production concept, the company is in a position to produce premium vehicles at the Leipzig plant in relatively small quantities at a competitive price. According to Porsche management, the proven production concept will also be used for assembly for the four-seater Gran Turismo Panamera, which will be introduced to the market in 2009.

German Federal Minister of Transport Wolfgang Tiefensee assessed the assembly of the Panamera in Leipzig as further proof that Eastern Germany is an excellent investment location. "The excellent infrastructure and the well educated work force are the advantages for this location that Porsche in Leipzig can utilize", the minister emphasized. At the same time, he also noted that the sports car manufacturer also stands for social responsibility. This increasingly includes the responsibility for climate protection, which the company perceives will further reduce fuel consumption in its vehicles: "The development of a hybrid drive for the Cayenne and Panamera models built in Leipzig can prove to be future oriented," the minister explained.

In his speech, Saxony's Minister President Georg Milbradt emphasized that Porsche is again investing its own financial resources in the Sachsen location and is not taking up any state subsidies: "That underscores once again the competitiveness of Saxony in the automotive industry and the attractiveness of our location," the Minister President said. According to Milbradt, not only does Leipzig profit from such a large investment, but also the supplier industry in Vogtland, the Erzgebirge and Oberlausitz. Leipzig's mayor Burkhard Jung was also pleased about the construction of the plant: "Today, an important step has been taken along the way to production of the Panamera. This is a good day for the city of Leipzig and the entire region," Jung stressed.

While the Panamera engines will be manufactured at the Porsche headquarters in Stuttgart-Zuffenhausen, the Volkswagen plant in Hanover will supply the painted chassis. The vehicle will then be assembled in the Leipzig plant. For the Panamera, Porsche thus arrives at an in-house production level of 15 percent. An added value of six percent is allotted to the Hanover-manufactured chassis. Since Porsche primarily works together with German suppliers, around 70 percent of the added value of the Panamera takes place in Germany.

Porsche Executive Board member Michael Macht is convinced that this car "Made in Sachsen" will become a worldwide sensation: "Not only will this provide a thrust for Porsche's further growth, it also strengthens Saxony's reputation in the automotive industry," Macht said. When the new Gran Turismo reaches the assembly line in 2009, a good 50,000 premium vehicles from the Cayenne and Panamera model series could be produced each year from the Leipzig plant, according to the Porsche Executive Board member. In addition, the new model series will also provide for positive employment effects – with around 600 new jobs at the Porsche plant in Leipzig as well at regional suppliers. At the VW plant in Hanover, an additional 500 positions will be permanently secured.

The Porsche Executive Board member also praised the smooth course of construction: "The framework and steel construction as well as the roof work is already complete. Now, pouring of concrete can begin for the floors." Finally, the assembly of technical installations for the plant such as laying pipes and cables can occur. The facades for the assembly building should be ready by the end of Summer 2007; the assembly equipment for the new model series can then be installed. During the course of 2008, the first prototypes of the Panamera will then be assembled.

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