With the Volkswagen and Suzuki alliance on a shaky ground, Volkswagen as a part of a new strategy is planning to place its fleet of cars in the premium category across segments.
The company feels this move would strengthen Volkswagen’s brand positioning in India. According to Mr. Neeraj Garg, Director (Member of Board) of Volkswagen Passenger Cars Division of Volkswagen Group Sales India Private Limited, the company wants to be in the premium category in every segment and does not want to be in the “crowded segment.” He further added, “Coming from Germany there is an expectation from the product and to meet that expectation you have to add to that premiumness.”
Mr. Garg stated that the Volkswagen’s Polo hatchback has been positioned in the premium category and bears a price tag of Rs. 5,00,000. The company has likewise positioned its mid-level sedans Vento, Passat and Jetta as the premium products in their segments.
Analysts believe Volkswagen India was hoping to benefit from Maruti Suzuki’s engineering capabilities to produce small cars. This would have given the company the access to enter the small car segment in India. However, with Suzuki threatening to break out of alliance, Volkswagen is now re-visiting its strategy.