New Bugatti 16C Galibier is a Go –

Volkswagen AG has agreed to fund production of the sedan, Bloomberg News reported on Friday, citing two unnamed sources that had knowledge of the project.

The 16C Galibier would join the Veyron sports car in Bugatti’s lineup. But Galibier production may not start for two to three years while Bugatti retools its boutique manufacturing plant in Molsheim, France.

The ultraluxury sedan was first shown in 2010 as a concept at the Geneva motor show. It shares the 16-cylinder, 1,000-hp engine used in the Veyron. Speculation on a price tag centers on 1 million euros, or about $1.4 million at current exchange rates.

Bloomberg said that new Bugatti and Bentley chief, Wolfgang Duerheimer, has been pushing for approval of the Galibier since he arrived from Porsche in February.

Bugatti began building the Veyron in 2005 and limits output to about 50 cars per year. The company says it won’t build more than 300 Veyrons.

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