VW Cranks Out Made-in-China DSGs

Bertel Schmitt
by Bertel Schmitt
vw cranks out made in china dsgs

The Chinese leader of the purchasing department of a very large Chinese car manufacturer once informed me: „Clutches? Don’t buy any Chinese clutches. They are all [expletive deleted]. We import all of our [expletive deleted] clutches.” Volkswagen is setting out to change that [expletive deleted] situation.

Today, the newly-founded Volkswagen Automatic Transmission Co, Ltd. started to produce Volkswagen’s tricky 7-speed dual clutch DSG transmission at a projected rate of 300,000 pieces a year. Its capacity will be gradually expanded to a maximum of 600,000 units. The factory is in the port city of Dalian, previously known for its beautiful scenery and beautiful women.

The Dalian facility is the second plant (after Kassel) in Volkswagen’s worldwide imperium to build the demanding DSG transmissions.

Volkswagen swears in their press release that “the locally-produced DSG transmissions will be installed in vehicles for the Chinese market.”

Note that they don’t say “for the Chinese market only.” At 600,000 pieces a year it would take a huge jump in DSG equipped Chinese VWs to absorb that kind of a volume. And if they are made at lower cost in Dalian than in Kassel, expect a Chinese DSG soon in a Volkswagen near you.

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9 of 13 comments
  • Japanese Buick Japanese Buick on May 11, 2010

    I wouldn't buy a VW DSG no matter where it was made. VW quality and engineering plus all those moving parts equals... uh oh.

  • Ronnie Schreiber Ronnie Schreiber on May 11, 2010

    If Chinese clutches are made so badly, my guess is that VW is importing the critical components of the DSG units, not locally sourced goods. Bertel, I think the comments from your Chinese purchasing acquaintance gives some perspective on your recent post about Chinese mfgs embracing QC with fervor. While some executives and managers recognize the need for improved quality, that view is not entirely universal among Chinese manufacturers. Also, the problems we've seen in the US with contaminated/adulterated Chinese products (lead paint on kids' toys, melamine in animal feed) illustrates that many Chinese manufacturers rely on second and third tier suppliers with little QC oversight of those vendors. I suspect that concepts like QS and ISO have not permeated throughout Chinese manufacturing. So while the ultimate manufacturer of a product might have developed-world level QC measures in their own facilities, they still depend on a supply chain that has little regard for quality. As you pointed out, yes many Chinese manufacturing facilities are brand spanking new with the latest technology, but there are still plenty of shops in China (and India) where the work is done by hand or with crude or obsolete equipment. BTW, a while back I saw an interview with a honcho at Bobby Bosch who said that due to quality and intellectual property concerns Bosch was very careful about what they built in their Chinese plants. There are technologies that they just don't want to share with their JV partners. I don't want to sound like a one-note Johnny, but it seems to me that ultimately the Chinese policy of forcing foreign manufacturers into JVs with Chinese partners is not a good idea.

    • See 3 previous
    • Psmisc Psmisc on May 12, 2010

      Hmm, didn't know Europe doesn't have same quality problem with Chinese imports that America has. Do you have any good links? I'd like to read more on that.

  • Hreardon Hreardon on May 11, 2010

    My guess is that VW is using the China fab as an assembly plant with all of the components shipped in from Europe. On the subject of QC: I recently had the great pleasure of sharing a flight home seated next to a German executive who spends half of his year in China. They sell highly sophisticated environmental controls. His take is that China is moving up the QC chain far, far quicker than most Western pundits are willing to give them credit for. His opinion is that China is within 5 years of matching QC on most automotive parts and assembly techniques, and within 7-10 years on most "sophisticated" electronics. Take it for what you will, but I tend to agree that we're underestimating our esteemed competitors.

    • Brian E Brian E on May 11, 2010

      This should not be surprising. Anyone who has bought a computer or a cell phone in recent years has purchased hundreds or thousands of Chinese-sourced parts. I source batteries from China and it's almost impossible to get them from anywhere else. Needless to say the quality is quite good. If I was looking for bad parts I could almost certainly find them from China too, but that would be pointless and probably dangerous.

  • Shortthrowsixspeed Shortthrowsixspeed on May 11, 2010

    what's with that diagram. you would think VW would at least translate the German to Chinese. talk about the responsibility of the importer . . .