News: Volkswagen to invest $530 m in India

(AP 28/11/2006) New Delhi - Europe's largest car manufacturer Volkswagen AG plans to invest $530 million (euro400 million) to build its first plant in India, the German Embassy said Tuesday.

The factory will be built near the city of Pune in Maharashtra, the embassy said in a statement. An agreement between Volkswagen and the government of Maharashtra state will be signed Wednesday, it said.

On November 17, Volkswagen's supervisory board approved the company's plans to build the car assembly plant in India, a lucrative market where automobile sales are growing 25 per cent annually on the back of a booming economy.

The plant will employ around 2,500 staff and is due to start production of a compact vehicle in the second half of 2009.

Volkswagen-owned Czech carmaker Skoda Auto AS already has a plant in Maharashtra. That factory assembles the Octavia, Laura and Superb sedans.