VW needs this collaboration more than TML. Remember, platform costs are almost 60% of a vehicle's developmental costs. And from what the canaries sing: talks had been on for close to a year w.r.t. the same subject between the two OEM's.
If one takes a very objective view, the going has been pretty rough for VW over the last year or so. It's reputation as a car maker has been severely tarnished due to the emissions cheating scandal.
In its traditional markets of Western Europe and United States, VW is certainly not being viewed with the same degree of credibility as before. Heck; they even had to drop the
"Das Auto" from their global advertisement tagline.
In India the story is worse. With an ageing product line and tepid sales, VW's India operations are under tremendous pressure.
The AMEO project's monthly sales targets are way off the mark. They can't even bring in the MQB, as it will necessitate the setting up of a new line which will suck huge amounts of funds.
The bean counters at Germany are extremely reluctant to part with fresh capital to facilitate a new line of India specific products unless commensurate sales revenue can be guaranteed. The genteel folks at VW India are quaking in their booties for such commitments.
Then: Competition. Traditional European competitor's; such as Renault etc are way ahead in the volumes stakes. PSA is about to move in too. It can be a hit or miss but it will not be very prudent for VW to rule the Gaul out.
So, poor VW in India is really in a bind. Thus the approach to TML to share the Advanced Modular Platform or AMP - which again is very similar to VW's MQB architecture. However Indian engineering ingenuity has developed it at a much lesser cost much to VW's consternation and amazement.
The TML AMP is package protected for all crash norms. It also has the ability to support conventional, electric or hybrid architectures. In fact, a few reliable birdies tweet that VW was mightily impressed when TML had showcased the AMP to them. That the AMP can support a plethora of models - from hatches to sedans to SUV's to MUV's, was another enticement to VW.
On the styling front, one can be sure that the upper bodies for both marques will have their own signature styling cues.
On the retail front too, VW will definitely be positioned as a "premium" marque and TML will faithfully stick to their "more car per car" positioning.
One more important thing: handling the inter-cultural niceties to prevent or reduce to a minimum unending engineering decision making sloth, build-up of ego etc.
In fact, these intangibles, (of course, there were many other technical aspects too), played a considerable part & were responsible for Suzuki's inability to make its venture work with VW.
TML should fare better. They have a history of handling the Germans well and have considerable experience working with them on the engineering front. Plus the present MD is from their ilk, hence the probability of meeting of minds is more than falling out over decisions!
This will be an interesting development for the Indian automotive industry. Let's await the formal announcement / press release! TML once saved JLR, who knows they might bring in a breath of fresh air to VW India too!
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