VOW3 Volkswagen AG

   By Pietro Lombardi 
 

Luxury-car maker Audi AG (NSU.XE) and Italian wheel maker Cromodora have reached an agreement regarding a new wheel plant in Eastern Europe, Audi said Thursday.

The Volkswagen AG (VOW.XE) unit said the cooperation will last up to 10 years. Under the agreement, Cromodora will build the new plant exclusively for Audi and the Volkswagen group, with production expected to start in 2023.

Audi is guaranteeing its partner that it will source its wheels from Cromodora for a specified period of time.

"For both partners it is equally important to make production highly cost-efficient. Audi and Cromodora have therefore agreed transparent, optimized cost structures. Risks are shared by the two partners, for example if the costs of raw materials rise," the German company said.

Write to Pietro Lombardi at pietro.lombardi@dowjones.com

(END) Dow Jones Newswires

January 16, 2020 05:43 ET (10:43 GMT)

Copyright (c) 2020 Dow Jones & Company, Inc.