Volkswagen de México, S.A. de C.V.

January 2014

Plant: Puebla and Silao

Area: Puebla: 3,000,000 m², Silao: 600,000 m²

Production: about 515,000 vehicles, 786,000 engines (full year 2013)

Models: Volkswagen Jetta, Beetle, Beetle Cabriolet, Golf 7, engines, components

Employees: 15.800 employees in Puebla and 600 employees in Silao

Management: Andreas Hinrichs

Previous Investments: 1964-2013 : US$8 billion

Volkswagen plant Puebla / Volkswagen de México - Aerial picture of the main production facility in Puebla

The headquarters and the vehicle and component plants of Volkswagen de México are located in Puebla, the capital of the federal state of the same name, 120 km south east of Mexico City. The new Volkswagen engine plant, the 100th plant in the Volkswagen Group, was opened in Silao in the central Mexican state of Guanajuato in January 2013.

The Volkswagen plant in Puebla is the largest automobile factory in Mexico and simultaneously one of the largest vehicle plants in the Volkswagen Group. All the processes needed for vehicle production, including the stamping of body parts and the production of engines, axles and catalytic converters, take place here. In 2013, a total of 516,000 vehicles left the production lines in Puebla. The plant covers an area of 3,000,000 square meters, with buildings accounting for about 550,000 square meters.

Volkswagen de México builds four models in Puebla: Volkswagen Jetta 4 (Clasico), Jetta 6, Beetle, Beetle Cabrio.Volkswagen celebrated the production of the ten millionth vehicle and the eleven millionth engine in Mexico in August 2013.

Furthermore, production of the Golf 7 for the North and South American markets began in early 2014. Puebla will produce the 2- and 4-door versions of this Golf based on the Volkswagen Group's MQB (Modular Transverse Toolkit) as well as the Golf Estate (from the end of 2014). This marks the start of vehicle production based on the MQB in Puebla and thus lays the foundation for building further models based on this technology in the future.

The Silao engine plant has been supplying the latest-generation engines to the vehicle plants in Puebla, Mexico, and Chattanooga, USA, since the beginning of 2013. It is designed for an annual capacity of 330,000 engines and has a total area of 60 hectares, with buildings accounting for 76,000 square meters.

In the Mexican market, Volkswagen de México not only markets vehicles from the Volkswagen Passenger Cars brand, but also models from the SEAT, Audi, Bentley and Porsche brands. In 2013, deliveries of all Group brands in Mexico totaled some 190,000 vehicles.

Andreas Hinrichs has been CEO of Volkswagen de México since March 1, 2011, having previously headed the Volkswagen subsidiary Autoeuropa in Portugal. Other members of the Board of Management are Alfons Dintner, responsible for production and logistics, Dirk Grosse-Loheide, responsible for North American purchasing, Mike Glenning, responsible for sales, Björn Ehlbeck, responsible for finance and organization, and Dieter Neuhäusser, responsible for human resources.

Environment and sustainability
With its "Think Blue. Factory." initiative, the Volkswagen brand has set itself clear targets for the environmentally sustainable positioning of all its plants. By 2018, the aim is to reduce the environmental impact of all Volkswagen plants by 25 percent. Specifically, this means 25 percent lower energy and water consumption, waste volumes and emissions at all plants.

In 2005, Volkswagen de México set up the "Conservation Biology Research Award" with annual prize money of 1 million Mexican pesos (approx. €60,000) under the motto "for the love of the planet". The aim of the environmental program is to promote research into biodiversity and nature conservation in Mexico. A research award of 500,000 Mexican pesos honors the outstanding work of a scientist each year. The same amount is awarded each year to key environmental protection projects which may run for several years.

In March 2008, Volkswagen de México launched another major nature conservation project. In cooperation with 39 suppliers and the National Commission of Natural Protected Areas, the company is supporting the reforestation of 600 hectares on the mountain range between Iztaccíhuatl and Popocatépetl at an elevation of 3,600 meters. 490,000 conifers have now been planted and 47,000 soakaways constructed. 4.12 million cubic meters of water per year are to be captured to replenish the groundwater in the Puebla valley. This is significantly in excess of the volume of water used by Volkswagen's Puebla plant, the partner companies and households of all the program partners' employees. The trees also stabilize the ecosystem because the new biomass absorbs carbon dioxide and contribute to improving living conditions for indigenous species. To date, Volkswagen de Mexico has invested more than €1,000,000.

A further reforestation project with the same goal was initiated near the new engine plant in Silao in the state of
Guanajuato in 2011.

Corporate social responsibility
Volkswagen de México makes an important contribution to the Mexican economy by creating jobs and through its high export volumes. In addition, Volkswagen in Mexico is committed to providing support for social projects. Employees and company have donated more than 25 million Mexican pesos (about €1.7 million) since 2002 in support of social projects for needy children in Puebla State.

In order to develop the abilities of its employees, Volkswagen runs a special training and education establishment in Puebla (Instituto Volkswagen). This institute also includes a language school which not only teaches Volkswagen employees, but also provides courses for the general public at its branches in the city. Technical vocational training based on the German dual system forms the core of training activities. Production operatives receive three years of training. These services are also offered to other companies, especially suppliers located near the plant.

Volkswagen plays an important role for the economies of Puebla and Tlaxcala states not only because of the Puebla plant but also because of the more than 50 automotive suppliers located within a 50-kilometer radius of the plant. 20 of the most important suppliers operate from industrial parks next to the plant, facilitating just-in-time delivery to the assembly lines. Volkswagen has a total of more than 300 suppliers in Mexico. In 2013 Volkswagen de México sourced about 70 % of its purchasing requirements from suppliers in the NAR region.