* VW striving to replace Toyota as biggest auto maker
* To spend average 16.7 bln euros a yr over three yrs
* Compares with av 12.5 bln a year from 2012 through 2016
By Maria Sheahan
FRANKFURT, Nov 23 Volkswagen AG has
earmarked 50.2 billion euros ($64.7 billion) of investments over
the coming three years as it accelerates plans designed to help
it become the world's largest car maker by the end of the
As the company strives to replace Toyota Motor Corp
as the No.1 auto maker globally, it is expanding its presence
outside Europe, building or planning new factories in markets
such as China, Mexico and Russia.
It is also stepping up investments in products and
technology to consolidate its lead over stricken western
European peers, which have slowed or shelved whole programmes,
engine technologies and platform revamps while grappling with
high costs in a shrinking European market.
"Despite the challenging economic environment, we are
investing more than ever before to reach our long-term goals,"
the German group's Chief Executive Martin Winterkorn said in a
statement on Friday.
Volkswagen's total spending equals an average 16.7 billion
euros for the three years from 2013 through 2015. Last year, it
had said it would invest 62.4 billion euros in the five years
from 2012 until 2016, or an average 12.5 billion per year.
The Wolfsburg, Germany-based company said its capital
expenditure would total 39.2 billion euros, or 6 to 7 percent of
sales for the period, broadly in line with analyst estimates.
That means Volkswagen will invest almost as much in
property, plants and equipment over the next three years as
analysts see Toyota and U.S. rival General Motors Co
spending together, according to Thomson Reuters StarMine.
VW's strong sales outside Europe have allowed it to offer
cut-price deals and swell its share of the battered European
market to almost a quarter.
Yet while the multi-brand group is less exposed to
austerity-hit Europe than rivals Peugeot SA and Fiat
SpA, finding the cash to achieve its goal is becoming
harder and it has to balance keeping a tight rein on short-term
costs with the need to develop new products.
VW, which had a net cash cushion of 9.2 billion euros at the
end of September, will spend 10.6 billion euros on development,
for instance on the introduction of new models and the design of
More than two thirds of overall investments will go towards
increasing vehicle efficiency and the development of more
environmentally friendly products.
In addition, 9.8 billion euros will be invested in new
production facilities and products at joint ventures in China.
As these joint ventures are not consolidated, their spending is
not part of VW's overall plans.