Now Reading: VW CEO sees India-EU FTA as chance for niche models
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VW CEO sees India-EU FTA as chance for niche models
Volkswagen CEO Thomas Schafer has said the India-EU free trade agreement presents a big opportunity to bring niche models from its global portfolio to India. During a visit to India, Schafer said…
Volkswagen CEO Thomas Schafer has said the India-EU free trade agreement presents a big opportunity to bring niche models from its global portfolio to India. During a visit to India, Schafer said the company is taking a long-term view and will study market conditions before deciding which models to introduce. Volkswagen has already confirmed a locally produced compact SUV for launch next year.
Schafer said the company is reviewing its global strategy amid geopolitical tensions and changing trade policies, with India playing an increasingly important role. He said India is not just a growing domestic market but also a hub for engineering, IT and R&D. Volkswagen already exports vehicles from India to over 40 markets, and exports will be key to building scale.
On powertrains, Schafer said Volkswagen has technology ready for flex-fuel, CNG, diesel and EVs but the timing for localisation depends on market conditions. Cost remains a challenge, and the company is working on reducing its cost base by developing and manufacturing more in cost-efficient locations like India. Final product and investment plans for India are still under consideration.
Indian Opinion Analysis
This is not the first time Volkswagen has announced a major India push. The company entered the market with high hopes in the 2000s but has struggled to reach meaningful scale. Its current India market share is below 2%, far behind rivals like Hyundai and Maruti Suzuki. The new compact SUV is critical: if it fails to generate volumes, the broader investment case weakens. An FTA could lower tariffs on imported niche models, but those are low-volume, high-margin products that do little for market share. The real test is whether Volkswagen can produce affordable cars in India, at Indian cost levels, while maintaining German quality. Watch for the compact SUV's pricing and localisation level when launched next year.
Source: autocarindia.com
This story was synthesised by AI from the source linked above.
