Volkswagen to launch compact saloon in India

  • Volkswagen to launch a sub-compact sedan  on the UP! Platform
  • UP! Hatchback could see a market launch by 2014
  • New 1.5 litre diesel engine under development

Volkswagen India couple of days back shook everyone with its new ad campaign by placing a vibrating device under the paper. The German company is known for its out of the box marketing campaigns. 2010 and 2011 seemed to be the glory years for the company but the situation seemed to reverse in end 2011 and the start of 2012 with sales declining on a month on month basis.

VW also saw a lot of turbulence in the top brass with key people vacating the company. But situation seems to be under control. The company first brought in Arvind Saxsena, which is the new MD for the Indian operations and recently also announced big ticket investments.

Volkswagen also plans to launch new products and on the anvil is a compact sedan on the lines of Maruti Dzire and Tata Indigo CS. Maruti tasted instant success with new Dzire and also launched the car with a automatic transmission. with compact Verito and Brio sedan, respectively. During April-August the super compact sedan segment grew by over 30% to 88,342 units, while the overall car market grew just 7.2%.

To take full advantage of the of the tax benefit, Volkswagen plans to launch a sedan which will measure under 4 metres. The company is also studying the feasibility of the UP! Hatchback for the Indian market and has already commenced testing to make it suitable for the Indian conditions.

Another important step is the launch of a new 1.5 diesel engine. Code named EA 189, the engine will be a derivative of the existing 1.6 diesel engine which does the duty on the Vento and the Rapid. The new 1.5 diesel engine will replace the diesel motors on the Rapid, Fabia, Polo and Vento. This will also help to bring down costs due to economies of scale.

Renault-Nissan have adopted a similar strategy and has helped the company to price its products very aggressively. We can expect the VW group products to get more price competitive in future. VW has taken its first step by launching the Polo and Vento and new revised prices with more features.

Info Source: ET

Image Source: MAD