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Slowdown signs - Volkswagen sees Mexican auto output to fall

Mr Otto Lindner head of Volkswagen's Mexico operations said that it expects Mexico's automotive production to fall by 30% due to the global recession. Back in January 2009, it predicted an output decline of 20% for 2009.

Currently, VW’s Puebla plant in Mexico is operating at partial capacity. It is in Mexico where the firm manufactures the Jetta, Beetle and SportWagon, also known as the Golf Variant.

Mr Otto also announced that the company will begin assembling a new compact car at its plant in Mexico early next year following a USD 1 billion investment. He added that of the total planned investment, USD 400 million will be spent on the creation of a new assembly line at the Puebla plant.

Mr Otto further added that "The rest of the investment will go toward the modernization of existing production lines and the development of the new vehicle."

Volkswagen is Mexico's number two automaker, selling most of its cars to the United States, Canada and Europe.

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