Volkswagen secures euro 100 m loan

“We have signed a contract with the European Investment Bank for Euro 100 million. This will be used for our investment at Chakan, where we are setting up a manufacturing facility,” said a Volkswagen (VW) Group official.VW is investing Euro 580 million (about Rs 4,000 crore) at the Chakan plant. The Chakan plant, which opened in March this year, has an annual capacity of 1.10 lakh units. It would achieve full-capacity production by 2012.

VW, which is planning to launch its mass-segment car Polo in India next year in both hatchback and sedan models, had last month said that the new car would be manufactured in the Chakan plant. Pre-production testing of the car is currently going on at the facility.

The Chakan facility currently produces a small number of Skoda Fabia. VW also assembles its sedans Jetta and Passat there for sale in the Indian market. The official said that VW had recently signed a contract for Euro 130 million from the IFC.