Volkswagen considering new entry-level brand for China

Volkswagen may be considering the creation of a new brand for China. According to Automotive News, the German Automaker is currently looking into the creation of a domestic brand aimed squarely at the budget buyers of the People's Republic. VW officials said that it is currently in discussions with its Chinese partner, First Auto, about whether the move would help VW retain its hold on the market, and it would put Volkswagen in good company. AN reports that automakers like Honda and Nissan have crafted similar brands in the past.
The Chinese government wants foreign automakers to build domestic brands in order to share technology and expertise with their partners while most automakers simply want to sink their teeth deeper into one of the quickest-growing markets on the planet. Volkswagen says that despite being leading automaker in China at the moment, it's still not effectively competing in 20 percent of the market. That segment is made up entirely of inexpensive vehicles.

Tapping those lower-rung car buyers could go a long way toward helping the automaker reach its goal of becoming the world's largest by 2018.

[Source: Automotive News]

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