Under a plan to lower emissions of Volkswagen AG's locally built vehicles, the carmaker is set on spending 400 million euros ($508 million) to start building fuel-efficient dual-clutch transmissions in China.
Winfried Vahland, who heads VW's China operations, said that the start of production in China is a further important step for the Volkswagen Group China.
He added that with the support of advanced propulsion technologies, VW will be closer to its goal of widening its market share while reducing consumption and emissions of its cars at the same time. Three years ago, VW set a target to lower fleet consumption and carbon dioxide emissions in China by 20% by 2010.
VW has plans to produce the seven-speed so-called "DSG" (Direct Shift Gearbox) transmission at its Dalian powertrain site, where 300,000 units will be produced initially before the capacity can later be doubled.
Last April, VW revealed that the investment program in two of its joint ventures in China will be boosted through 2012 by 1.6 billion euros to 6 billion altogether. This investment will be financed directly using the cash flow of the two joint ventures.