HONG KONG (Reuters) – SAIC Volkswagen said on Saturday that adjusting its production base was “natural and necessary” in response to reports it would close its Nanjing plant, China’s Yicai media reported.
Reuters reported this week that Germany’s Volkswagen plans to halt production at one of its combustion engine car plants in China, a sign that automakers are struggling to manage excess capacity in the world’s largest auto market.
Some reports have said that the joint venture between Volkswagen and its Chinese partner SAIC Motor will close the Nanjing plant, although a person with direct knowledge of the matter told Reuters that the company has not yet decided whether to sell or close the plant.
“SAIC Volkswagen said that based on the company’s strategic planning and feedback on market trends, the company’s adjustment of its production base is a normal and necessary business behavior,” Yikai said in response to a question on Saturday about plans to close the Nanjing plant.
SAIC Volkswagen said production at the Nanjing plant remains normal but as it rolls out many new products in the future, including gasoline and new energy vehicles, it needs to adjust its production base accordingly, Yikai quoted the company as saying.
The company did not immediately respond to a Reuters request for comment on Saturday. On Wednesday, Volkswagen said it does not comment on speculation and SAIC could not be reached for comment.