Volkswagen:

German automaker Volkswagen wants to become the biggest car maker in the world and the company’s current crop of car brands seem inadequate for it to achieve this outcome. What Volkswagen is currently missing in its vast portfolio of brands is a big-volume, low cost car brand. Something on the lines of Renault’s Dacia or Nissan’s Datsun is what Volkswagen has been working towards for a while now and according to a German magazine Manager Magazin, a breakthrough on this front could come as early as a few weeks from now. The new brand could get the green light in the next few weeks and the first cars under the new low cost brand are likely to roll out in late 2016 or early 2017. 

However, a top Volkswagen group official, Mr Heinz-Jakob Neusser, speaking on the sidelines of the recently concluded Geneva Motor Show, said that the automaker was finding it difficult to achieve cost targets for the low cost brand without diluting the traditional traits that VW group cars are famed for. Known for their tough build and high quality, Volkswagen cars enjoy a good reputation across the globe. With the low cost car brand, the Volkswagen group will have to walk the tightrope between maintaining a high level of quality and delivering a low cost proposition that appeals to the purse strings of car buyers in emerging market.

China and India are two key markets that will be in the cross hairs of the new Volkswagen budget brand, whose cars are said to cost a maximum of 7,500 Euros or 7 lakh rupees. Rumours suggest that Volkswagen will partner with Chinese automakers such as SAIC and FAW to develop cars for the low cost brand. Currently, Volkswagen is in multiple collaborations with Chinese automakers such as SAIC and FAW. Both Chinese brands are strong in their home markets of China, where they sell a range of Volkswagen-based car models. Expect cars from the Volkswagen low cost brand to feature high amounts of local content.