Rumour: VW to finally make more investments in India

The Volkswagen group is planning to revamp its operations in India. According to a media report, the company is planning to add a new production line at its plant in Chakan, set up a new engineering centre and develop new low-cost cars for India and other emerging markets. For this, it is reported to be planning to invest an additional Rs. 7,600 crore in the country.

At present, the company positions itself as a premium manufacturer. Under its new strategy, it will be launching cars based on its low-cost MQB-A0 platform. These cars are expected to feature a high level of localisation. The line-up is expected to include one hatchback each from the Skoda and Volkswagen brands, positioned against the likes of the Maruti Suzuki Baleno and Hyundai Elite i20, a sedan that is expected to replace the Rapid and Vento, and an SUV that will be a rival for the Hyundai Creta. The MQB-A0 platform is likely to be introduced by 2022-2023. Till then, to cater to export markets, the company will us an updated version of an existing platform.

Skoda, which is a part of the Volkswagen group, is at the helm of this strategy. The Czech company's chairman and a team of 40 senior engineers are reported to have visited India in connection with the new strategy. The company is also conducting a study to analyse expansion of its production capacity to volumes of 1,80,000, 2,50,000 and 3,20,000 units per annum.

Volkswagen has been present in India for over 15 years and its market share stands at less than 2%.

Source - Economic Times