India to become low-cost export hub for Volkswagen

By siliconindia   |   Thursday, 04 February 2010, 14:54 IST
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India to become low-cost export hub for Volkswagen
New Delhi: Following the success path of Hyundai Motors and Suzuki Motor; Volkswagen AG plans to make India a low-cost manufacturing hub catering to select export markets. Talking to Economic Times, a senior executive of Volkswagen said, "From the second quarter of the next fiscal, we will export fully-built models and completely knock down kits of Polo, to South East Asia, Middle East and Africa from its Pune plant." The company is all set to launch Polo this month-end in India. Polo costs 4.5-6 lakh. To compete against Hyundai's i20, Polo is priced half of the European price as the company has been able to ram down costs by sourcing 80 percent of auto parts from the domestic market. "We are looking at all potential markets for export," said the executive who asked not to be named, adding that many markets in South East Asia and Africa would prefer the India-made Polo for its competitive pricing. Car exports grew 30 percent to 3.3 lakh units between April and December last year from a year ago. Volkswagen has set a production target of 50,000 for Polo in 2010. The company plans to ramp up production next year after it launches the sedan version of the Polo.

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