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Volkswagen brand to extend China lineup to 10 SUVs in four years

[BEIJING] Volkswagen AG'snamesake brand is pushing for growth in China, one of the few markets where the carmaker has been largely untouched by its emissions-cheating scandal.

The German manufacturer plans to about double its sport utility vehicle lineup in China in the next four years to 10 models as it sees sustained growth in demand for the rugged, high-riding models. Rollouts will include two compact city SUVs as well as two models larger and more luxurious than the mid- size Tiguan, Juergen Stackmann, who runs sales for the marque, said in an interview at the Beijing car show. Volkswagen will produce the vehicles in China with its local joint venture partners.

"If you imagine the Tiguan as the focus on the brand, we'll add two models above the Tiguan, as well as two SUVs to the portfolio below," Mr Stackmann said. "We don't see an end to the growth of the SUV segment, at least not for another two generations of car models."

China, its biggest national market, has been a rare bright spot for Volkswagen this year following the revelation in September that the German manufacturer had rigged 11 million diesel-powered cars worldwide to cheat on official emissions tests. The VW brand's Chinese sales rose in the first quarter, in contrast to drops in Europe and the US

With Volkswagen setting aside 16.2 billion euros (S$24.65 billion) for resolving the emissions scandal, keeping the cash flowing from China will be critical to weathering the crisis. The group's Chinese operations added 3.78 billion euros to its bottom line in the first nine months of 2015. Only the Audi luxury brand contributed more to earnings. Full-year figures will be reported on Thursday.

To repair its tarnished image, Volkswagen is presenting an upscale plug-in hybrid SUV concept, the T-Prime GTE, at the Beijing show. The model indicates where "we see our SUV offering headed in Europe," Mr Stackmann said. The vehicle is set to enter production "in the short-term," Herbert Diess, head of the VW brand, said at the event. The car has an electric-only range of 50 kilometers (31 miles).

The German carmaker, known for reliable but staid sedans like the Passat, has been slow to adapt to customer demand for SUVs. While it sells higher-riding "cross" versions of the Polo and Golf hatchbacks and Lavida wagon in China, it's only pure SUVs are the Tiguan and Touareg.

To further shore up its offering in China, the company also plans to add seven new locally built plug-in hybrid and electric models over the next three to four years, responding to toughening emissions rules for smog-filled cities, Volkswagen said in an e-mail.

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