OREANDA-NEWS. September 10, 2010. Volkswagen expects to expand production in Russia and boost annual sales to 360,000 cars by 2017-18, VW CEO Martin Winterkorn said.

VW plans, in the medium term, to sign contracts with Russia's GAZ Group for the use of its production facilities and in the long term expand its plant in the Kaluga region, Winterkorn told Prime Minister Vladimir Putin during a meeting.

Putin said the Russian government would do all it could to create an investor-friendly environment for VW in Kaluga.

"The Russian government and local authorities will do all they can to create favorable conditions for this investment: After all, it is 570 million euros [USD 730 million]," Putin said.

Volkswagen started full-cycle production at the Kaluga plant in October 2009 and currently assembles Volkwagen Tiguan and Skoda Octavia cars there. Its planned capacity is 150,000 cars a year.