Volkswagen's small car not to compete with Nano

German auto major Volkswagen on Wednesday said its proposed India-specific small car, to be launched in 2010, would not take Tata's Nano head-on as it will have some premium attached to it.

'Our small car will be an absolutely new car and designed specially for India. This will be in the premium category and thus has nothing to do with Nano,' Volkswagen Group India's President and Managing Director Joerg Mueller told reporters after launching Jetta, a lower D segment sedan, here.

The small car, he said, will be on the lines of Polo, which the company markets in Europe.

'But, it will not be Polo,' he said, adding 'components for the car would be outsourced from Indian suppliers'.

Volkswagen will manufacture its India-specific small car at its upcoming greenfield plant at Chakan in Pune where the company is investing ₹3,500 crore.

'The plant will go on-stream in the first half of the next year, a year ahead of schedule,' Mueller said.

The plant will have an assembling capacity of 1.1 lakh cars per annum.

Tata Motors had already stated that Nano, priced at ₹one lakh, would be rolled out in October this year.

Mueller said the company aims to sell 20,000 cars this year in India comprising 1,200 Jetta, available in one petrol and two diesel variants.

Volkswagen sold 10,366 cars in India in the first six months of the year, recording a 69 per cent growth over the same period last year.