VW is set to invest 1 billion euros ($1.16 billion) from 2019 to 2021 which will be led by Skoda Auto. This is part of Skoda’s ‘India 2.0’ project which includes setting up engineering design and development center at Pune. The group’s two plants at Aurangabad and Pune will also be enhanced.
Based on VW’s flexible MQB platform, the group will launch a new SUV which is expected by the second half of 2020. The group is targeting 5 % of the Indian passenger vehicles market by 2025.
According to Skoda Auto CEO Bernhard Maier:
“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 is the first and most decisive step.”
“It will be ready by the end of the year…we plan to hire 200-250 engineers to develop cars in India.”
Expected to create 5000 direct and indirect jobs, VW has around 2 percent market share in passenger vehicle segment in India or about 3.2 million units in 2017 to 2018.
“We want to exploit the maximum of our current capacities in Pune and Aurangabad. Our plan is to have a market share of 5 per cent for VW and Skoda brands together in India by 2025. We decided 1.5 years ago that we want to tackle the Indian market better than we did in the past. In India we are doing it collaboratively…This market is expected to be one of the biggest markets in the world. From 3.2 million units, the market is expected to grow to 5-6 million units by the end of next decade.
Maier also added:
“We are not looking at cheap cars and not are only driven by volumes; we want to be on a sustainable growth path. Skoda is taking the lead but there are going to be two brands in the market.”
Skoda has sold around 2.5 lakh units since November 2001 and sells four models – sedans Superb, Octavia, Rapid, and SUV Kodiaq.
About VW Group
Volkswagen Group is a German multinational automotive manufacturing company headquartered in Wolfsburg, Lower Saxony, Germany. It designs, manufactures and distributes passenger and commercial vehicles, motorcycles, engines, and turbo machinery and offers related services including financing, leasing and fleet management.
Volkswagen was founded in 1937 in Berlin, Germany to manufacture the car which would become known as the Beetle. In 2015, it produced 9.93 million motor vehicles, the second-largest number of any company in the world, behind Toyota and ahead of General Motors. The company sells passenger cars under the Audi, Bentley, Bugatti, Lamborghini, Porsche, SEAT, Škoda and Volkswagen marques; motorcycles under the Ducati brand; and commercial vehicles under the marques MAN, Scania, Neoplan and Volkswagen Commercial Vehicles.
It ranked seventh in the 2016 Fortune Global 500 list of the world’s largest companies. With revenue of €213.292bn($225.76bn) and 610,076 employees.
Founded in 1895, Skoda engages in the development, production, and sale of vehicles and related accessories in Western Europe, Central and Eastern Europe, Asia, Africa, Australia, and internationally. Headquartered in Czech Republic, Skoda Auto operates as a subsidiary of Volkswagen Group.