Despite investing a substantial USD 2 billion (Rs 166879500000 crore) in the Indian market, German auto giant Volkswagen is facing challenges and is considering selling its stake in the country. The company’s high-priced European cars haven’t been able to secure a substantial market share, prompting Volkswagen to explore a potential sale to a local partner.
A top global executive has revealed that Volkswagen is actively developing more affordable car models in an effort to boost its low market share, as reported by TOI. However, the timeline for finalizing a deal with a local partner remains unclear.
Volkswagen has also voiced concerns about the tax rates on hybrid vehicles in India, arguing that forcing consumers to transition solely to electric vehicles when the market is still shifting away from petrol-diesel engines is premature. The company believes that hybrid vehicles offer a more gradual and realistic path to a greener automotive landscape.
It’s worth noting that in September 2021, another automaker, Ford Motor Company, had initially announced plans to exit India before reconsidering its decision.
Volkswagen’s headquarters in India is located in Pune, and the company officially entered the Indian market in 2007 with the iconic Passat model. This news further highlights the challenges faced by foreign companies trying to establish a strong presence in the competitive Indian automotive market.
