Volkswagen to Boost Powertrain Output in China, Russia

Volkswagen AG says it will invest €250 million ($313 million) to erect an engine plant in Kaluga, Russia, and €300 million ($376 million) for a new transmission plant in Tianjin, China.

VW, which aspires to become the world's top-selling automaker by 2018, is seeking growth in emerging markets. The company aims to sell half a million vehicles per year in Russia by 2018, up from about 225,000 units currently.

The Kaluga project is part of the company's €14 billion ($17.5 billion) program to develop new models and expand assembly capacity in Russia through 2018. The factory is scheduled to begin producing 1.6-liter gasoline engines in 2015 with annual capacity of 150,000 units.

The Chinese transmission facility, which is scheduled to open in 2014, will create about 1,500 jobs, the company says.