Volkswagen, Europe's largest automaker, uses a top-down strategy when starting cars in India. And within a period of two years, the automaker plans to bring their small car followed by what appears to be a minibus under the category Maruti 800 to India.
After recently announcing that it will begin introducing all the new Passat as its vehicle in India, Volkswagen plans to start the next what it calls the A class, the Gulf and its derivatives. According to Pierre Bruedgam, a board member buying Volkswagen India, we will be launching a new car every year. This year, it is Passat sedan, a B-class car that will be launched in September. And for next year. The A-class, which combines the golf and its derivatives, will be launched and then followed by a volume segment car that will be offered as notchback and hatchback for 2009. In our terminology, the small car is a Zero Class. We also look at A Zero Class, which corresponds to Maruti 800. "
Mr. Bruedgam was in Pune for the engagement of his office and at the same time sought an interested local purchase for the E410 million fleet, of 110,000 chakan capabilities. Volkswagen India expects to reach 110,000 capacity by 2009 when it launched its small car, the Gulf and its derivatives.
And since India is considered more of a sedan market, Volkswagen India would first try to sell sedans like the Passat and then follow it up with the Gulf and its derivatives. For a large part of its proposed set-up, the automaker is expected to maintain 55:45 ratios between diesel and gasoline. Mr Bruedgam added: "We will start our business from April, first because the cars will be made here and then for the global market."
Volkswagen officials after visiting India saw that a single purchasing office might not be enough and said they might need to open other offices in the other two auto hubs in Delhi and Chennai. VW's officials have also stated that logistics are an important consideration when buying global businesses if the company aims to remain competitive. They also added that Europe's largest automaker can also get some of its metal products from India specifically for their required volume products. And since a large number of VW cars are expected to be sold in India, the automaker would also ensure that after-sales services such as repairs are made available to those customers who are in addition to the vehicle's Volkswagen repair manuals.
Mr Bruedgam also said that the localization program employed by Volkswagen hopefully requires 50% local content at the start of production in 2009. As for car volumes, automaker expects an increase of 75% in 2011. Dr. John Chacko, a board member, VW India, said: " We will source from India for volume models like golf and its derivatives, where the same part can be used. VW extends its platform theme to a module strategy that allows us to use the module anywhere in the world. "Other VW Group companies such as Audi and Skoda are also expected to come out of India.