AUTOS: American-Made Rabbit

Volkswagenwerk AG finally made it official last week: the supervisory board voted to buy a plant in the U.S. to make its fast-selling Rabbit model. The move was scarcely a surprise; VW has been talking about putting up a U.S. plant for years. Nor will the giant German automaker be the first foreign company to assemble cars in America—Sweden's Volvo has already started building a $100 million plant in Chesapeake, Va. Still, the formal decision illustrates how changes in currency values can transform world business patterns.

VW had no choice. President Toni Schmücker...

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