VW pumps R4 billion into South African factory for all-new model

VW has announced a R4-billion investment into its Kariega, Eastern Cape manufacturing plant which currently produces the Polo and Polo Vivo for local and export markets.

The investment will be used to upgrade the facility in preparation for the addition of an all-new model to its production line-up from 2027.

The majority of the total sum is allocated to capital expenditure for production facilities, manufacturing tooling, local content tooling, and quality assurance. Nearly R877 million will be spent to enhance automation in the body shop, and R418 million will go to procuring new tooling in the press shop.

“Plant Kariega is an important manufacturing plant within the Volkswagen Group production network. Since 2011, Volkswagen has invested R10.28 billion in production facilities, manufacturing equipment, local content tooling, and training of people,” said Martina Biene, Chairperson and Managing Director of VW Group Africa.

“The new investment is a vote of confidence in the future of the plant. It also futureproofs jobs, not only for our people but also those employed in our supplier network.”

VW Kariega Plant

The new locally-made VW

The new VW model that will be built at Kariega from 2027 onwards will be a small SUV seated on the same platform as the Polo.

Due to demand for internal combustion-engine vehicles and the slow introduction of electric cars into African markets, it will be powered by a petrol motor, likely a 1.0-litre unit like the T-Cross and Taigo.

It is currently in the design phase which is being spearheaded by VW’s Brazilian subsidiary and the company aims to achieve approximately 40% local content levels in the production of the vehicle.

“Volkswagen Brazil is leading the design and development of the new SUV,” explained Biene.

“Volkswagen Group Africa’s Engineering team has collaborated with Volkswagen Brazil for the adaptation of the new model to the local and continental requirements, that for example includes the development of a right-hand drive version.”

There have also been rumours that VW may produce a compact bakkie on the same underpinnings as its new entry-level crossover, but they remain unconfirmed at this point.