By CHRIS GRAEME chris.graeme@theresidentgroup.com
Fears that Volkswagen’s Autoeuropa car plant could abandon Portugal within the next few years surfaced again last week as the German company celebrated its 15th anniversary in the country.
After more than a decade producing models such as the Sharan and Alhambra at its plant at Palmela, near Lisbon, union and industry bosses linked to the automotive sector stressed their fears that the company could pull out of Portugal and relocate to Eastern Europe.
The company’s production in Portugal is currently running at just 55 per cent of its total output production due to the economic crisis affecting car sales worldwide.
The production of people carriers is down to 54 per cent, the Eos down to 40 per cent and the Scirocco down to 30 per cent.
Plans to produce the new Sharan, which were announced a month ago, and the new Alhambra, unveiled a week ago, look increasingly shaky with the company planning to reemploy just 150 workers in May.
With the end of the production of older models, the plant currently has an output that is less now then it was back in 1995 when it set up in Portugal.
It is estimated that Autoeuropa represents 50 per cent of all automobile assembly in Portugal and 20 per cent of all component production in the sector.
The company imports many components for the cars rather than having them made by national suppliers.
Portuguese automotive companies, specialists and employees estimate that the current value of new models for the Portuguese economy is likely to be well down on expectations, down to around 20 per cent, although Volkswagen has refused to give projection figures stating that its process for supplier selection is not yet ready for release.
The company, for now, states that it is committed to Portugal for the next five or six years but the government accepts that it doesn’t know for definite if the new Volkswagen Sharan model will, in fact, be produced in Portugal.
