SAO PAULO — Volkswagen Group has finalized a dedication to launch a brand new funding cycle in Brazil, its CEO for South America instructed Reuters in an interview on Friday.

“Now we have outlined (the funding) and we already stopped manufacturing at our manufacturing unit in Taubate to arrange the brand new platform,” Pablo Di Si stated.

Di Si declined to enter specifics similar to the dimensions of the funding, which is able to exchange the present funding cycle that was introduced in 2016 with a dedication of seven billion reais ($1.34 billion).

That cycle was initially scheduled to finish final yr however the timeline was stretched out when the coronavirus pandemic hit.

Up to now this yr, VW has change into Brazil’s best-selling model, displacing Normal Motors after a few years, partly as a result of GM’s manufacturing in Brazil has been extra disrupted than VW’s by a worldwide chips scarcity.

Di Si stated the main points of the funding might be disclosed by the worldwide CEO of Volkswagen Passenger Vehicles, Ralf Brandstätter, throughout a visit to Brazil later within the yr, though the precise timing is determined by how the pandemic evolves.

The manufacturing unit in Taubate at present produces two compact vehicles, the Sedan Voyage and the hatchback Gol. Di Si didn’t specify what’s going to occur to these fashions, whether or not they are going to be upgraded or changed.

“The funding will reinforce our product portfolio as probably the most vital manufacturers by way of market share,” he stated.

VW, like its friends around the globe, has been focusing increasingly on creating bigger vehicles, similar to SUVs and pickup vehicles on the expense of compact vehicles, each due to the upper profitability of bigger automobiles and since customers are searching for these merchandise increasingly as nicely.

“It is a development that may solely speed up,” Di Si stated. “It is not that the entry-level phase will disappear, however one sees how the phase is turning into drastically smaller.”