Features
3 Jul 18

VW Group invests in India’s growing market

Volkswagen Group called the press together on July 2nd to announce its next step of the “India 2.0” project. It’s VW Group’s objective to reach a consolidated market share of 5% by 2025, up from today’s 2% in a 3,2 million unit market.

Skoda

The Group’s Skoda brand has been selected to become the face of the investment in India. A new engineering and development centre in Pune is to be set up and the capacity of the 2 existing plants in Aurangabad and Pune will be increased. The total value of the investment is announced to be 1 billion Euro, between 2019 and 2021, creating up to 5000 jobs.

"We are now investing up to 1 billion euro by 2020-21. This is the biggest investment which we have done in one single market. This the first and most decisive step," said Skoda Auto CEO Bernhard Maier.

Flexible Platform

From a manufacturing point of view, the efforts will be concentrated around VW’s flexible MQB platform. Both Skoda and VW brands will be using the platform and a mid-sized SUV is to be expected by mid-2020. Skoda’s Maier added: "The platform can have many body styles, we do not rule out anything. If market is ready then we can be ready too."

Important fact is that Skoda/VW are not aiming for the extremely successful small and cheap car market in India, traditionally TATA’s and Maruti-Suzuki’s strength. The brands want to build safe and sustainable models in India.

Previous failure

VW has, in the past tried to partner up with India’s TATA, which is now described by VW execs as a failure, leading to VW’s new strategy. The company says to understand the transforming Indian landscape better now and is looking forward to playing a part in a market that is expected to grow to 5-6 million units within 10 years.

Authored by: Yves Helven