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Volkswagen is extending its co-operation with JAC to develop LCVs.

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Volkswagen Group will expand co-operation with China’s Anhui Jianghuai Automobile (JAC) beyond electric cars to jointly develop and build Light Commercial Vehicles (LCVs) in the world’s largest car market, claim industry sources. They draw attention to an announcement by Volkswagen and JAC to develop and build electric vehicles. This is said to be part of an effort to meet the Chinese government’s production and sales quotas for new-energy vehicles. In September 2017, China set a deadline of 2019 to impose tough new sales targets for electric plug-in and hybrids vehicles, slightly relaxing an earlier plan to launch the rules from next year that had left global automakers worried about being able to comply.

In view of the development, Volkswagen is said to be looking at co-operating with JAC in the areas of design, technology, product quality and development of LCVs. The venture would include combustion-engine and alternative-energy powered vehicles. To be owned equally by JAC and VW according to industry sources, the venture, expected to be based in JAC’s home town of Hefei, would tap the growing demand for light pick-up trucks in China among others. Stressing upon the growing number of loyal customers in China, Joern Hasenfuss, Member of the Board of Management Volkswagen Commercial Vehicles, said, “We are seeing significantly more opportunities.” Considering that Volkswagen is keen to carve out a bigger pie of the dynamic LCV market in China, the joint venture with JAC should provide it with the advantage of local know-how and market reach. Volkswagen would also save import duties by building its LCVs in China. Including the Amarok, Multivan and Caddy, Volkswagen has a wide range of LCVs in a pick-up and van guise, which could find a calling in the growing Chinese market. The German major could use JAC facilities.

The Ecuador arm of Volkswagen began building the Amarok pick-up in September 2017 with local partner FISUM. In October 2017, the company put up a strong show by displaying its complete range of LCVs at Comtrans 2017 in Russia. Volkswagen is also said to be looking at India to introduce some of its LCVs in India. Producing the Caddy at a multi-brand facility in Algeria, Volkswagen is said to be looking at introducing the Amarok pick-up range in India.

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