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VW may move production because of Russia's cutoff of natural gas

Volkswagen AG is exploring ways to counter a shortage in natural gas, including shifting production around its network of global facilities, signaling how the energy crisis unleashed by Russia’s invasion of Ukraine threatens to upend EuropeÂ’s industrial landscape. Volkswagen, EuropeÂ’s biggest carmaker, said Thursday that reallocating some of its production was one of the options available in the medium term if gas shortages last much beyond this winter. The company has major factories in Germany, the Czech Republic and Slovakia, which are among European countries most reliant on Russian gas, as well as facilities in southern Europe that source energy from elsewhere. “As mid-term alternatives, we are focusing on greater localization, relocation of manufacturing capacity, or technical alternatives, similar to what is already common practice in the context of challenges related to semiconductor shortages and other recent supply chain disruptions,” Geng Wu, VolkswagenÂ’s head of purchasing, said in a statement.  RussiaÂ’s decision to throttle gas supplies to Europe has raised concerns that Germany might be forced to ration its fuel. Recent news that gas storage levels hit 90% ahead of schedule has soothed fears of acute shortages this winter, but Germany faces a challenge in replenishing depleted reserves next summer without contributions from Russia. Southwestern Europe or coastal zones of northern Europe, both of which have better access to seaborne liquefied natural gas cargoes, could be the beneficiaries of any production shift, a Volkswagen spokesman said by phone. The Volkswagen group already operates car factories in Portugal, Spain and Belgium, countries that host LNG terminals. Labor hurdles To be sure, any major production shift away from EuropeÂ’s biggest economy would face significant hurdles. VW has some 295,000 employees in Germany and worker representatives account for around half the companyÂ’s 20-member supervisory board. Any shift in production would likely involve a limited number of vehicles rather than wholesale factory shutdowns. While gas supplies for VWÂ’s plants are currently secured, the company has identified potential savings at its European sites to cut gas consumption by a “mid-double-digit percentage,” said Michael Heinemann, managing director of VWÂ’s power-plant unit. Still, the carmaker said it was concerned about the effect high gas prices could have on its suppliers.

Audi Q3 recalled for wanting to stay dry

Volkswagen of America has announced a recall of the 2015 Audi Q3 because in one instance the car might not stop what it's doing even when you turn it off. If you shut down the car while the sunroof is closing, the sunroof could keep on closing. That possibility contravenes federal standards concerning roof panel systems and affects up to 3,646 examples of the Q3 manufactured between April 4, 2014 and November 5, 2014. Customers are asked to bring their Q3s to their Audi dealers, where the sunroof control module will be updated free of charge. You'll find a bit more information in the bulletin from the National Highway Traffic Safety Administration below. Related Video: Report Receipt Date: APR 03, 2015NHTSA Campaign Number: 15V200000Component(s): VISIBILITYPotential Number of Units Affected: 3,646Vehicle Make Model Model Year(s): AUDI Q3 2015Manufacturer: Volkswagen Group of America, Inc.SUMMARY: Volkswagen Group of America, Inc. (Volkswagen) is recalling certain model year 2015 Audi Q3 vehicles manufactured April 4, 2014, to November 5, 2014. If the vehicle is turned off while the sunroof is closing, the sunroof may continue to close instead of stopping. As such, these vehicles fail to comply with the requirements of Federal Motor Vehicle Safety Standard (FMVSS) 118, "Power-Operated Window, Partition, and Roof Panel Systems."CONSEQUENCE: If the sunroof is closing while the vehicle is shut off and a vehicle occupant is in its path, there is an increased risk of injury.REMEDY: Audi will notify owners, and dealers will update the sunroof control module software, free of charge. The recall began on April 13, 2015. Owners may contact Audi customer service at 1-800-253-2834 FREE. Volkswagen's number for this recall is 60C1.NOTES: Owners may also contact the National Highway Traffic Safety Administration Vehicle Safety Hotline at 1-888-327-4236 FREE (TTY 1-800-424-9153 FREE), or go to www.safercar.gov.

VW and partner SAIC start building $2.5B Audi plant in China

BEIJING — Volkswagen AG's China joint venture with SAIC Motor Corp has started building a $2.5 billion new energy vehicle (NEV) plant in Shanghai, which will make VW's luxury Audi brand cars, a possible first for the venture. The new plant is a key step for Audi to diversify production of its cars in the world's largest car market from its long-standing local partner, China FAW Group Corp. This shift has been delayed amid resistance from local dealers. SAIC Volkswagen said the new plant would have an annual capacity to make 300,000 cars and begin production from 2020. Audi sold 481,387 vehicles in China from January to September this year. The announcement comes the same week Tesla secured a Shanghai location for a Gigafactory battery plant to serve the Chinese market. Audi unveiled the plan to bolster ties with SAIC in late 2016. Earlier this year, the Germany luxury carmaker bought a 1 percent stake in the SAIC Volkswagen venture, paving the way for the joint venture to produce and sell Audi cars. Volkswagen currently gets a larger proportion of the proceeds from the 50-50 tie-up with SAIC than from its 40 percent stake in the venture with FAW. SAIC Volkswagen said in a statement on Friday the plant would cost 17 billion yuan ($2.5 billion) and would make VW and Skoda models as well as Audi cars. It will help VW tap China's fast-growing market for NEVs, a category comprising electric battery cars and plug-in electric hybrid vehicles. ($1 = 6.9314 Chinese yuan renminbi) Reporting by Yilei Sun and Adam JourdanRelated Video: Image Credit: Reuters Green Plants/Manufacturing Audi Volkswagen Skoda Electric Hybrid