Volkswagen is determined to stick to its ambitious expansion plans in Russia, despite the prospect of economic sanctions for the country because of its invasion of Crimea.
VW CEO Martin Winterkorn said the company should not be affected by the fact that EU leaders have been discussing sanctions for Russia.
“I believe we should not scale back our activities in Russia because of this,” the executive told Reuters on Thursday.
VW Group has spent €1 billion ($1.4 billion) on Russian operations from 2006 to 2013 and said in December 2013 that it would invest a further €840 million in its sixth-biggest market through the end of 2015.
VW is building a new engine plant in Kaluga, where it already has an assembly plant. More than 5,100 people work there assembling VW and Skoda models. The carmaker aims to increase sales in Russia by more than 60 percent to 500,000 cars, from 303,000 in 2013.
“Our sales numbers continue to look good, but we’re paying very close attention to what is happening there. Investments are still running; we will not stop the new engine plant,” Winterkorn said.
Image: Vladimir Putin and VW CEO Martin Winterkorn
Vladimir Putin inspects a VW vehicle in Hanover, Germany – 2013
Last week VW’s finance chief Hans-Dieter Poetsch said that the automaker was fighting the effects of extreme currency volatility that was placing a “clear burden” on the company’s Russian operations.