Volkswagen China to invest $12 bn in new energy vehicles.

Volkswagen will invest more than 10 billion euros ($12 billion) along with its partners in China to build new energy vehicles in the country, the company said on Wednesday.

Volkswagen is also establishing a new joint venture with state-owned JAC Motors to make electric vehicles, with an aim to get the first electric car to market by next year, the company said in a press release on the eve of the Guangzhou Auto Show.

The move comes as China has put in place a series of carrots and sticks to compel carmakers to produce more fuel efficient and eventually petrol-free cars.

Volkswagen has been a laggard in the area so far, selling just a few hundred 'green' cars among sales of four million vehicles in China last year.

BS