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Audi planning $17 billion expansion

Audi will pour billions into German, Hungarian, Chinese, and Mexican plants in the next four years.

Audi has been enjoying robust sales globally as part of the VW group and will need to significantly update and expand its manufacturing capability to keep pace. In an effort to meet the needs of its growing customer base, Audi hopes to spend two billion Euros each year (about $3 billion) globally.

Currently, Audi is planning to spend the equivalent of about $10 billion US dollars just to update two plants in Germany, the flagship Ingolstadt plant in Bavaria, which has been in operation for almost 50 years and also the Neckarsulm facility located near Stuttgart, which is a plant that Auto Union acquired when it merged with NSU in the 1960s. An investment this massive in existing plants can only mean both expansion as well as modernization.

In addition to improving and expanding current sites, Audi plans new plants on three continents. In Asia, Audi will build a plant in Foshan China. Audi plans deliveries from the plant to being in 2014. In North America Audi will begin production of vehicles in the San Jose Chiapa plant in 2016. Mexico has been a hot manufacturing location for automakers all over the world. Finally, in Europe, Audi will be building vehicles in Hungary in a new and improved plant in Gyor.

Audi expects to do all of this with profits of about five billion Euros per year. Axel Strotbek, Member of the Board of Management for Finance and Organization at AUDI AG summed up the company’s strategy saying, “We will keep investing large sums to pursue our growth strategy. The expansion of our global manufacturing infrastructure will help us to continue growing,”

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