Seat plans for China shelved

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Seat was initially hailed as VW’s savior in southern China, traditionally a market that VW has always underperformed in Southern China when compared to the local automotive giants that are in partnership with the Japanese giants of Toyota and Honda.

VW aimed to set up a factory producing funky new Seat cars
that were all set to appeal to young relatively wealthy Cantonese who traditionally preferred Japanese brands to VW models, but it appears that VW’s plans for Seat have so far been shelved.

VW believes that the lack of factories in the south of China is the major upset for a lack of sales in the region and has pushed its joint venture partners, FAW and SAIC to open factories in the southern regions. FAW-VW have planned to establish their factory in Guangdong’s Fushan city, aka the home of Kung-fu, whilst Shanghai-VW have planned to put their factory directly into the center of Guangdong’s capital city, Guangzhou.

The reasoning behind the shelving of Seat China is not entirely clear, but it does appear to be due to VW wanting to get its factories set up and further establish the Skoda brand in China before reaching into its inner portfolio to launch more new brands in China. Another reason being cited for delaying the introduction of Seat into China is Seat’s large small car line up which would go directly against VW’s recent small car line up of the Bora, Lavida, Golf and Polo.
China was going to be Seat’s last big chance, with it loosing $430million in Europe alone last year and is VW’s, and Europe’s, weakest selling brand, it could be that VW silently gives Seat the Luger treatment before it even makes it to the Orient.

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One Comment

  • aw
    May 25, 2010

    before you know it VW brands will be competing against each other in europe and elsewhere. That would be a real dilemma. The labour cost advantages of Check and Spanish have now disappeared. The range of cars VW,Seat,Skoda are all more or less the same. Relaying too heavily on Diesels and no real alternative options on the table. Before you know it even the Chainese brands will overtake VW on Electric sector. May be it is time to turn to Lowe Saxony state again. Good luck VW

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