German auto giant Volkswagen sets up massive parts hub in Johor

German automotive giant Volkswagen Group has set up a new regional parts distribution centre in Johor, in a move seen as a boost to the economy which took the brunt of the year-old Covid-19 pandemic.

The new centre in the Port of Tanjung Pelepas occupies a 50,000 sq m facility, and can store some 65,000 genuine parts for Volkswagen, Audi and Skoda brands.

The centre will serve 21 markets in the Asia-Pacific region.

“Malaysia offers a central and well-connected location which perfectly suits our plans to expand our foothold in the region,” Christian Dahlheim, head of sales at Volkswagen Group, said in a joint statement with the Malaysian Investment Development Authority announcing the massive facility.

The statement said the centre’s location in the free trade zone is well linked to air hubs and roads which will enable better logistics flow.

Volkswagen Group’s after-sales head Roman Havlasek described the new centre as a milestone in providing improved genuine parts delivery to the carmaker’s Asia Pacific market.

“The Malaysian government, through Mida, greatly supported our relocation to Malaysia. We were pleased by the ease of implementing our project here and the assistance given by the team at Mida,” he added.

Meanwhile, International Trade and Industry Minister Mohamed Azmin Ali said the latest facility followed the trend of automotive, life sciences, medical and electronics companies in choosing Malaysia as their international distribution hubs.

“These companies seek to tap Malaysia’s strategic location as well as our efficient and reliable infrastructure such as ports, airports and financial institutions, allowing them to improve operational efficiency and optimise product and service quality and speed for their customers,” he added.

The Volkswagen group sells an average of 11 million vehicles every year, and has close to 13% of the global market share for passenger cars. The group’s revenue in 2019 totalled €252.6 billion.