Plans to start making engines here, expand supplier base

Automaker Volkswagen plans to increase its indigenisation level by 10 percentage points and is aiming to double its market share in India in the next five years, said a top official.

“Currently, we have a localisation level of 82% and we are planning to increase it to 92% to 93% in a year’s time,” said Steffen Knapp, managing director, Volkswagen Passenger Cars India.

As part of the localisation efforts, the company plans to start making engines in India and expand the supplier base to produce various parts locally.

Mr. Knapp said that efforts were on to double its market share in India from the present 1.4% to 3% in the next five years, as part of the company’s India 2.0 plan, through six strategic brand pillars — people, brand positioning, loyalty programmes, network expansion, corporate fleets and digitalisation.

“It’s an ambitious target. We have laid the foundation and the fundamentals are in place to achieve this. Currently, we are selling 3,000 cars per month and we need to clock around 1.2 lakh units per annum,” he said.

Talking about the vision, brand positioning and mission, he said: “Our vision is to become a sustainable brand with a market share of 3% in the next five years: Our aim is to be an aspirational premium car brand in India and a brand which has the closest connection with customers and the highest loyalty within the industry.”

Asked about new launches, he said the firm was developing a new platform for India named MQB. Volkswagen will be launching its A0 SUV (sport utility vehicle) as the first product under India 2.0 initiative by end 2020-21.

The firm would be setting up 30 new sales format pop-up stores and city stores across high-potential markets in India.