Volkswagen India Strategy

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For all the talk about companies coming to an emerging market like India and setting up shop, no one has been more passive aggressive then the Volkswagen Group. VW is most famously known for its Beetle – one of the best selling cars of all time at over 21 million units. In a bid to move beyond the Beetle, VW in the 90′s started to acquire many brands and their complete portfolio is quite impressive: Audi, Bentley, Bugatti, Lamborghini, SEAT, Skoda and VW. The VW Group also owns 49.9% of Porsche and set to take 100% ownership in the near future. The linkage between VW and Porsche goes way back, VW was founded by Ferdinand Porsche. Then Ferdinand went on to start Porsche where his son created the iconic 911. Even today the bonds are strong, the Porsche Cayenne and VW Touareg share the same chassis (platform in car speak). Long Term Commitment

Enough of the history lesson, back to VW’s big bet on India. VW’s foray into India started in 2001 when it launched the Skoda brand and started selling the Octavia. Around 2007, the VW Group also added Audi, Bentley and VW to their Indian product line. These cars were available by importing them individually, however servicing was always an issue since they didn’t have official dealers on the ground in India. In another sign that VW is here for the long haul it opened a massive manufacturing facility in Chakan (near Pune) in 2009 and spent USD $500 million in the process. Towards the end of 2011, VW will add the high-performance brand Lamborghini to the mix. They will most likely unveil the first Lamborghini showrooms when they ship the highly anticipated fire breathing 691hp Aventador to India.

Breakout Hit
In the 4 door mid-luxury segment, the market leader for years has been the Honda City. The break out hit for VW has been the Vento which was introduced in 2010 and already has beaten the Honda City as the number 1 selling car in that segment. The Vento’s success is a combination of Honda lagging and VW bringing the...
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