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Volkswagen forms Turkish subsidiary ahead of factory decision

Volkswagen AG registered its Turkish unit in the country's western Manisa province shortly before the company is expected to name a location for its new factory, Reuters reported Oct. 2, citing the country's Trade Registry Gazette.

The German carmaker's new subsidiary will have a capital of 943.5 million Turkish lira, with a quarter of that amount already paid by the parent company, the report said. The Turkish unit will specialize in the design, production and assembly of cars, trucks and other vehicles, the news wire said.

In August, Reuters reported that VW is in talks with Turkish authorities over vehicle taxation as it looks to finalize a €1 billion assembly plant in the country.

VW told the news outlet Oct. 2 that it is still in the final stages of negotiations and that it is yet to make a final decision on the factory.

The automaker is also considering the possibility of building a new plant in eastern Europe, the news wire added.

As of Oct. 2, US$1 was equivalent to 5.70 Turkish lira.