Volkswagen Ramping Up Production in Malaysia

Malaysian production of Volkswagen cars is expected to begin in October or November with an initial run of more than 200 units.

Prime Minister Najib Razak says the complete-knock-down assemblies at the DRB-Hicom plant in Pekan will be the platform for making Malaysia the base for VW exports to Association of Southeast Asian Nations members by 2014.

Passat assemblies earmarked for Malaysia.

“The first batch from the Pekan plant will test the response of the local market for the model, a number of which, according to plans, will be exported to ASEAN countries,” the government’s Bernama news agency quotes him as saying.

Najib is confident VWs from the Pekan assembly plant eventually will reach the global market.

“Fans of Mercedes and Volkswagen will be more familiar with Pekan after this,” he says.

DRB-Hicom in December signed a collaboration and license agreement with VW and VW Malaysia to assemble CKD models. The company said production would start with Passat assemblies.

DRB-Hicom says the agreement gives it control over all VW production for the local market and, subsequently, the export market.

This includes procurement of CKD assembly kits, manufacturing and supply of components and the assembly of vehicles.

DRB-Hicom distributes and assembles foreign brands such as Audi, Mercedes-Benz, Honda, Suzuki, Mitsubishi, Isuzu and Mahindra, as well as Malaysian marques such as Proton, Hicom Perkasa and Modenas. It also manufactures components for the national cars.