Volkswagen invests Rs 720 crore towards production of new compact sedan in India

Despite being in the eye of a rather smoky storm, Volkswagen will continue with its plans of introducing a new compact sedan for India. Their intention is further confirmed with the company pumping in Rs 720 crore into the production of said vehicle at their Chakan plant in Pune.

The production of the compact sedan, which will benefit from the Government tax subsidy for sub-4m vehicles, is slotted to start from the first half of 2016. The investment will be directed towards product development, installation of new equipment and increasing production of the new Volkswagen.

During the above announcements from VW India, Dr Andreas Lauermann, president and managing director, Volkswagen India Private Limited, said, “We are following a long term investment plan in India and with our latest investment we have reaffirmed our confidence in this growing automotive market. . . This is the second step of investment after the engine assembly plant a year ago. Additionally, we will continue to invest further in increasing our productivity and efficiency.”

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The new sub-4m sedan from Volkswagen India will be showcased at the 2016 Auto Expo in Delhi. Volkswagen had exclusively told OVERDRIVE that if there is any issue with using the current crop of diesel engines in the compact sedan (read 1.5l diesel), then the company will initially launch the car with only a petrol motor. The launch is expected to take place in the second half of next year.

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