Volkswagen India: The Way Forward

[volkman10]

Skoda will lead the ‘Eco’ car platform for India. A platform that could accommodate the cars built on the MQB platform.

VW Group’s MQB platform will be re-engineered by Skoda to make it affordable for India and other emerging markets. New low-cost ‘Eco’ platform to be shared by both VW and Skoda.

Skoda’s engineers hope to ‘de-content’ the MQB by removing some of these systems which will reduce cost and weight. It is also likely that the high-tensile steel body panels which are hot stamped will be replaced with cold-stamped lower-grade steel, which according to a source will still exceed the standards in the Indian market.

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[volkman10]

Here is the confirmation from VW CEO Matthias on its India plans.

1. Will get products of the same MQB architecture but modified for cost reasons. ( Expect Polo, Virtus and the T's from 2019 and beyond)

2. The same platform ( ECO) will be used for other markets too, S America, Middle East and other emerging markets.

3. Skoda will lead this platform development which will be used by VW and Skoda.

4. Products out of this platform will also be exported from India to specific markets.

5. VW rules out going ELECTRIC as of now. Conventional engines and EV will co-exist.

Would you look at a new vehicle architecture for the Indian market?

It should be based on a cost-wise reduced platform suitable for the Indian cost, but be a part of the existing architecture.

Would you need a budget brand or eco-car startegy?

Yes. The strategy will not be for India alone, it will also be for South America, the Middle East, among other emerging markets.

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[volkman10]

All new products from the VAG group will surface only by 2020 and beyond. Will be on a highly localized MQB A0 platform.

But all products likely to be in a 'PREMIUM' offering (expect to be even more than the current)

We believe that from 2020 a localized MQB A0 platform would be competitive in the Indian market mainly in connection with the new crash and environmental standards and regulations, which will be introduced. The difference between Indian and European standards will become significantly lower which creates the space for this platform as an optimal solution also in terms of its techno-commercial viability

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[volkman10]

VW's upcoming CUV, T Cross will likely be the first car to be launched in India in the MQB A0 ( modified) platform. The Compact will rival Hyundai's Creta.

Expected to launch in 2020/21.

the India-spec version of the compact SUV will have a different set of features when compared to the one that will go on sale in Europe and other markets

T-Cross will measure under 4 metres in length when launched in India. In his brief conversation with us, Knapp told us that they’re looking at a complete Indian solution for the T-Cross SUV. It could mean that Volkswagen is eyeing to source more components from Indian vendors to keep manufacturing costs in check

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[MotorPaandi]

Thanks Volkman10 for these continuous VAG updates. Its great news that MQB (A0) is on its way to India. But I am not clear what the below mentions of 'India/Emerging countries specific solution' actually means. If it means, same architecture but local sourcing of components it is not a matter of concern & makes sense as well. But if it means dilution of design, engineering and component specifications it is not good for us. I would like to believe it is the former (i.e only localisation of parts), but references to cost-wise reduced platform focused on cost sensitive countries gives some room to think about latter (i.e platform dilution). Hope it is not the case.

Would you look at a new vehicle architecture for the Indian market?

It should be based on a cost-wise reduced platform suitable for the Indian cost, but be a part of the existing architecture.

Yes. The strategy will not be for India alone, it will also be for South America, the Middle East, among other emerging markets.

[volkman10]

Volkswagen will stop exporting the ' Made in India' Vento to Mexico post the release of Virtus in 2018.

India launch plans of VW's Virtus is yet to be decided.





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[ajmat]

From informal discussions, I got a feel for the following

1: VW are seriously looking at converting the existing Pune factory to MQB mainly for Virtus and other derivatives.

2: Timelines have not been committed to as yet. Not too much of a hurry as market volume may not utilse entire factory. Still exploring moving Octavia production to this factory if it becomes MQB, may be Karoq. Low volume, high value CKD's continue in Aurangabad

3: They are looking at smaller SUV's to be future volume sellers- plans were hidden by a knowing smile

[volkman10]

Volkswagen group to locally build more engines, considering India being a strategic growth market for future . More manufactures follow this trend.


VAG is setting up a new engine assembly line in Aurangabad at Skoda Auto’s factory to locally produce 3-litre diesel engines, apart from localizing 2-litre diesel engine in Chakan factory.

In addition to localising engines, Audi is also working aggressively in indigenising the axles of its cars in India, in order to de-risk itself from currency fluctuation and compete more strongly against the other German rivals

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VW presents its S American strategy until 2020. Some of these could arrive in India in the 'ECO' model strategy being developed by Skoda. T Cross, T Track ( A0 CUV) and Tarek/Tharu are the likely ones.





Source: VW

[volkman10]

Volkswagen wakes up from its deep slumber. Chalks out its India strategy. Will shed its premium positioning. But project is likely to kick in only in 2022/ 23.

The Volkswagen Group plans to invest 1billion euros (Rs 7,600 crore) more in India, as the world's largest carmaker seeks to launch a flurry of vehicles and expand capacity to shrug off its underperformance in one of the fastest-growing markets.

The group will spend the money to set up a new manufacturing line at its existing facility at Chakan in Pune, build an engineering centre and develop products. Developing electric vehicles is also under consideration.

Until then the VAG group will survive by upgrading its existing platform is being upgraded to meet requirements in overseas markets for exports.

The group has now decided to come out with an affordable portfolio on its own for emerging markets, based on the MQB-A0 platform. The new models will be heavily localised to keep the cost low.




Models on the fast track, all underpinning the MQB-A0 platform,

- B-segment SUV that will be benchmarked against the Volkswagen T Cross to take on the Hyundai Creta, code named VW 216.

- Premium hatchbacks from VW and Skoda to rival Maruti Baleno ( Polo/Fabia?)

- Mid-size sedan that will replace the Rapid and Vento ( Virtus?)

- The company is studying volume scenarios of 1,80,000, 2,50,000 and 3,20,000 units for capacity expansion, with considerable exports planned.

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[Mad Max]

Still can't make up their mind!! Swaying between "premium cars" and mass market "budget cars" . In the end, they'll end up like the Ameo. Everything looks great up front and then as you progress towards it, it ends abruptly like that short boot.

How can this be THIS hard? Pick a position, gain momentum and get going. I think VW has spent enough paper on these ideas that they can actually buy a paper plant and be profitable.

Making it easier for them - Maruti owns 50%+ of the share. Hyundai has another 20%, maybe? That leaves another 6-8 big players about 30% to divide among themselves at an average of 3% - 5% market share each. Now, whose market share is VW targeting? If they can answer that question, the rest should be easy.

[Thad E Ginathom]

I agree.

Thought they had a winning formula anyway: to beat the big guys on build quality at a decent price.

They are not, at least for a long time, going to beat the entrenched competition at numbers, but hey, there was never going to be an Apple PC on every desk!

[arunramaswamy]

I sincerely feel Skoda and Volkswagen should ditch the idea of becoming a mass market player and focus on the premium segments which is still in a nascent stage in India. They should target to be an alternative for the big 3 Germans.

They have already established themselves as a premium players. Time to ramp up and focus on premium segments instead of slogging it out in mass market.

Aim to become the "Maruti" of the premium market.

[vagabond128]

Originally Posted by arunramaswamy

I sincerely feel Skoda and Volkswagen should ditch the idea of becoming a mass market player and focus on the premium segments which is still in a nascent stage in India. They should target to be an alternative for the big 3 Germans.

They have already established themselves as a premium players. Time to ramp up and focus on premium segments instead of slogging it out in mass market.

Aim to become the "Maruti" of the premium market.

Very true.

Honda also tried this. We all know what happened.

India has a growing middle class. 'Maruti of the premium market' would not be a bad strategy.

[neoonwheels]

Better is to stick in between where Hyundai/Maruti premium ends and big Germans start. Skoda/VW cannot compete at mass mkt for price and can neither with Germans for brand reputation.

[volkman10]

Volkswagen evaluating India plans - Don't know what is taking so long in deciding their product portfolio for India?

Volkswagen Group is currently studying several options which involve phased investments. These investments could range from updated products to a complete new product portfolio

VW currently has an installed capacity to manufacture 2 lakh cars annually in a three-shift system from its plant in Chakan, Pune. The facility rolls out products from both VW and Skoda stables.

Depending on the decisions that will be made in the future, this capacity could be altered

Skoda's strategic approach is to launch this localised platform on the Indian market in 2020 when more stringent crash and emissions standards come into force,

In this context it is planned to produce competitive volume models for the brands Skoda and Volkswagen in India

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