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Volkswagen Launches $250 Mln Auto Factory in Russia

To produce engines for its other Russian auto factories

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KALUGA, September 4 (TASS) - Volkswagen Group Rus launched the 250 million-euro auto engine factory in Kaluga in central Russia on Friday.

The facility is located on the territory of the Grabtsevo technological park close to the Volkswagen auto factory.

"The enterprise will produce Series EA211 gasoline-powered engines with a capacity of 1.6 liters for Volkswagen Polo and Skoda Rapid cars produced at Volkswagen’s Kaluga auto plant. A part of engines will be supplied to the Nizhny Novgorod factory for Skoda Octavia, Skoda Yeti and Volkswagen cars," Technical Director of Volkswagen’s new factory Vitaly Nakhtigal said at a presentation of the new facility’s products.

The new facility will produce 150,000 engines a year and "will use the modern technology of metal stock’s dry machining," Nakhtigal added.

Volkswagen Group Rus has been among the first foreign companies that has built and launched its own engine-making plant in Russia.

From 2016, 30% of cars produced in Russia should be equipped with Russian engines.

"We’re both increasing the percentage of our cars’ localization and making them more affordable for our Russian buyers," Volkswagen Group Rus General Director Marcus Ozegovic said.

"Despite all economic difficulties, we have fulfilled all the obligations and this will become a true Russian product and an example of localization in Russia," he added.

Local supplies for Volkswagen Group Rus are expected to reach 50% with the launch of the new engine-making facility in Kaluga, the company said earlier.

The technological process at the new enterprise will be fully automatized and use 13 robotic systems produced by German, Slovenian and Italian hi-tech companies.

The new gasoline-powered engines will meet Euro-5 environmental standards.

"The region has invested 34 million euros in creating the factory’s infrastructure," Kaluga Region acting Governor Anatoly Artamonov said at the ceremony of the factory’s launch.

Volkswagen’s Kaluga auto plant produces Volkswagen Polo Sedan, Volkswagen Tiguan and Skoda Rapid cars. Its annual capacity is 225,000 cars a year. Volkswagen Group Rus has been manufacturing cars in Kaluga since November 2007 and employs about 5,000 people.

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