Volkswagen postpones final decision on Turkey plant

FRANKFURT/HANOVER (Reuters) - Volkswagen <VOWG_p.DE> has postponed the final decision whether to build a car plant in Turkey, the company said, amid international criticism of the country's military operation in Syria and concerns about potential reputational fallout.

"We are carefully monitoring the current situation and look with concern at current developments," a company spokesman said on Tuesday.

Earlier this month, Volkswagen established a subsidiary in Turkey's western Manisa province, while the company said that it was still in the final stages of negotiation and that it had not made a final decision on the factory.

Volkswagen supervisory board member Stephan Weil, prime minister in Lower Saxony where the carmaker is based, said that he could not imagine that Volkswagen will make an investment given the current circumstances.

Lower Saxony is an influential voice at the carmaker with a 20% shareholding.

"I have the impression that my view is shared by several other people in the supervisory board," Weil said, adding that topic would to be discussed at the next meeting of the supervisory board in mid-November.

"I very much hope that we will get back to a situation where the Turkish President realizes that he has embarked on a very dangerous path, and the direction must be changed urgently," he said.

German Chancellor Angela Merkel said on Sunday that she told Turkish president Tayyip Erdogan that the offensive must be stopped because it risked creating a humanitarian crisis.

European Union countries agreed on Monday to limit arms exports to Turkey, while U.S. President Donald Trump imposed sanctions on Turkey.

(Reporting by Arno Schuetze and Peter Mlodoch; editing by Thomas Seythal and Louise Heavens)