Volkswagen Considers Moving Production Base of Flagship Model 'Golf' to Mexico

Purpose of Labor Cost Reduction in Restructuring

German automaker Volkswagen, which is undergoing restructuring, is reportedly considering moving the production base of its flagship model, the Golf, from Wolfsburg, Germany to Mexico, according to the economic newspaper Handelsblatt on the 12th (local time).

The media cited company officials saying that Mexico, with its lower labor costs, is being considered as an alternative production site, and there is also a possibility of relocating to Poland for the same reason. Volkswagen operates the largest North American automobile plant in Puebla, Mexico, where it previously produced the Beetle model, which was discontinued in 2019.

The Golf, Volkswagen's flagship lineup, has sold approximately 37 million units since its launch in 1974. However, domestic sales in Germany have sharply declined from 370,000 units in 2009 to 80,000 units in 2022. Thomas Sch?fer, Volkswagen's CEO, recently stated, "The current 8th generation will be the last series of the Golf equipped with an internal combustion engine." Volkswagen is jointly developing the 9th generation Golf as an electric vehicle with the American company Rivian.

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