HONG KONG (Reuters) – SAIC Volkswagen (ETR:), responding to reports it would close its Nanjing factory, said on Saturday that adjusting its production base was “normal and necessary”, Chinese media outlet Yicai reported.
Reuters reported this week that Germany’s Volkswagen plans to halt production at one of its internal combustion car plants in China, in a sign of automakers’ struggle to control overcapacity in the world’s largest auto market.
Some reports said VW’s joint venture and Chinese partner SAIC Motor would close the Nanjing plant, although a person with direct knowledge of the matter told Reuters the company had not yet decided whether to sell or close the plant.
When asked on Saturday about plans to close the Nanjing plant, SAIC Volkswagen said that “based on strategic business planning and response to market trends, the company’s adjustment to its production base is a normal and necessary business behavior,” Yicai said.
Yicai quoted SAIC Volkswagen as saying that production at the Nanjing plant remains normal, but as it will roll out many new products in the future, including gasoline and new energy vehicles, it must adjust its production base accordingly.
The company did not immediately respond to Reuters’ request for comment on Saturday. Volkswagen said on Wednesday it does not comment on speculation and that SAIC could not be reached for comment.
