RIA Novosti citing Mr Marcus Osegowitsch Volkswagen Group Rus chief executive as saying that German auto giant Volkswagen plans to launch the production of a low cost car based on the Volkswagen Polo at its assembly plant in Kaluga in central Russia in late 2012.


Mr Osegowitsch said the world premiere of the new model, will take place in summer 2012, adding that the Volkswagen Polo Sedan will not be removed from production. He declined to say whether the new car would be assembled under the Volkswagen or the Skoda brand.

Volkswagen Group Rus and GAZ Group part of Basic Element holding company owned by Russian billionaire Mr Oleg Deripaska, in February closed an agreement on the production of Volkswagen and Skoda vehicles at GAZ plant in the central Russian city of Nizhny Novgorod.

Mr Osegowitsch said the company planned to produce compact cars and crossovers at GAZ. He also said Volkswagen's 2011 sales target had been increased 50% to 200,000 cars. He said the company was recruiting staff for a third shift at its Kaluga plant, which was to start working in August.

Volkswagen launched production at the Kaluga plant in 2007. The plant has an annual design capacity of 150,000 cars.

(Sourced from RIA Novosti)