VW Postpones the Turkish Factory plan

HAMBURG -- Volkswagen Group is again postponing its decision on whether to open a factory to build VWs and Skodas in Turkey, a source told Reuters.

"We still have time and can certainly do that decision by mid-year," said the source, who is familiar with VW's discussions.

VW had picked Manisa, 40 km (25 miles) northeast of Izmir on Turkey's western coast, for the 1.3 billion-euro ($1.4 billion) plant.

It was scheduled to build the next-generation Passat and its sister model, the Skoda Superb, starting in 2022, with a maximum annual production capacity of 300,000 vehicles.

VW delayed a final decision on the plant in the wake of international criticism of Turkey's military operations in Syria. The company said in December it would likely decide on the investment in February.

Czech media reports said Skoda is asking VW Group bosses to allow the brand to build its cars in other group plants. Skoda is suffering a capacity crunch because of strong demand for its new SUVs.

The introduction of the fourth-generation Skoda Octavia compact car, produced at the Czech plant in Mlada Boleslav, is likely make the situation worse, the reports said.

One possibility is to transfer some of Skoda's Czech production to VW's plant in Brastislava, Slovakia, which already produces the Skoda Citigo minicar, or to Audi's factory in Gyor, Hungary, reports said.

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