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Volkswagen India to infuse Rs 1,500 crore investment to increase localisation

Snapshot: The company is also mulling to build an engine plant in Maharastra.

On the sidelines of the launch of the 2014 Volkswagen Polo Facelift that got underway yesterday, the German automaker announced plant to infuse an investment of Rs 1,500 crore in the Indian market over the next five to six years. The said investment will be utilised for various activities with a major focus on increasing localisation in the production process.

“India is a strategic market for us and we are looking at investing here in a systematic manner. Over the period of the next 5-6 years we intend to invest Rs 1,500 crore on activities like enhancing localisation and new products.” Volkswagen India president & managing director, Mahesh Kodumudi said while, addressing the media at the launch event.

Furthermore, the company is reportedly, also evaluating building engines in India, but hasn’t arrived on a decision yet. Kodumudi added that if the plan does get green lighted, then the company’s first preference for setting up the engine plant would be in Maharashtra. Currently, the company imports 100 per cent of the engines used in its cars in India. 

“Currently our localisation levels here are around 65-70 per cent in value terms and going ahead our objective is to take it to 85-90 per cent. We can achieve it by localising production of engine and gearbox and we are working on it.” Kodumudi said. 

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