Volkswagen to Continue Production in China amidst Declining Sales
Published By : 28 Jul 2015 | Published By : QYRESEARCH
China at present is witnessing sluggish demand in its industrial sector. China is one of the most lucrative and profitable markets for vehicles. Despite this, Volkswagen does intend on lowering the manufacturing in the China market for cars. This information was revealed by reliable sources at Volkswagen.
Considering the present situation in the global car market, Volkswagen has taken to cost cutting measures and many other such measures for managing the business amidst falling global demand for cars. In fact, the company has brought down the total yearly working days at factories from 300 to 270. However, when it comes to the business of Volkswagen in China, there have been no prominent changes that have been introduced. This is perhaps because China is one of the largest automotive markets of the world.
As per analysts at Sanford C. Bernstein, the plant and factory utilization by some of the key car brands in the China market has declined to a little over 94%. This was the figure during the first six months of the year. Business analysts have also indicated that in order to keep businesses on the fast track of growth, international car makers should and will have to accept the lower rates of utilization in the future. Several domestic and international car manufacturers are starting factories mainly in China that in any other country. This points to a certain construction trend which is occurring in the midst of changing and fluctuating market conditions.
In June, the sale of passenger vehicles in China declined on a year-on-year basis, which was a “one of a kind” decline that took place in two years. The country’s economic growth has been slowing and the situation in the stock markets is far from optimistic for most of the investors and buyers.