FAW-Volkswagen Automobile Co. began building an assembly plant in the north China port city of Tianjin last week, a sign of the joint venture's confidence in China's long-term prospects despite choppy sales in recent months.

 

The plant will cost 19.5 billion yuan ($3 billion), and will produce up to 300,000 cars a year.

 

FAW-VW is a joint venture between Volkswagen AG and China FAW Group Corp. that builds and sells vehicles for the VW and Audi brands.

 

In a written statement, the partners indicated the plant would improve the supply of vehicles to northern China. But they did not indicate when the project would be completed.

 

FAW-VW has assembly plants in the northeast China city of Changchun, the southwest China city of Chengdu and the south China city of Foshan. It is also building an assembly plant in the east China port city of Qingdao.

 

Volkswagen also has a joint venture with SAIC Motor Corp., which has production operations in Shanghai, the east China cities of Nanjing, Yizheng and Ningbo, the central China city of Changsha and the northwest China city of Urumqi.

 

SAIC-Volkswagen Automotive Co. produces vehicles for the Volkswagen and Skoda brands.

 

In the first four months of this year, Volkswagen's brands sold 1.25 million vehicles, up 4.8 percent from a year earlier.