Volkswagen starts looking for partners in India, wants to expand operations

German auto giant Volkswagen is looking to tie up with local car manufacturers in India to expand its operations in the country. The carmaker, which also owns brands like Skoda Auto and luxury vehicle manufacturers like Porsche, Audi and Lamborghini, is now in talks with other companies to partner in production of passenger cars in India. Volkswagen currently sells Taigun SUV and Virtus sedan as the two mass market models besides Tiguan SUV. Currently, the brand is working on introducing the ID.4 electric SUV as its first EV in India soon.

For Volkswagen, India is one of the smallest markets for the German group. The company admitted that making money in the Indian auto industry is tough. India accounted for a little over one per cent of Volkswagen's overall deliveries across the entire group last year with just 1.01 lakh units delivered. Volkswagen Passenger Cars grew by eight per cent in 2023 and is now targeting a 15 per cent volume sales rise in 2024. Taigun and Virtus remain the two best-selling models for the carmaker in India.

Arno Antlitz, Chief Financial Officer (CFO) at Volkswagen Group, said that India has the potential to offer bigger opportunity for the brand in coming days. "We are in very good discussions. It's very, very concrete. I think we shouldn't underestimate the potential in India in terms of a market ... and in terms of regulatory uncertainty between the U.S. and China. I'm very positive about India," said Antlitz.

Volkswagen currently manufactures its vehicles from two facilities in India. These plants are located in Aurangabad and Pune in Maharashtra. Both plants have an annual capacity of around two lakh vehicles. Volkswagen recently signed a deal with Mahindra and Mahindra on use of key electrical components of its open platform for electric vehicles.

Check out Upcoming Cars in India 2024, Best SUVs in India.