Volkswagen is committed to building a new car plant in India but new chief executive Martin Winterkorn has started a review of which models to build there, the car maker was reported to have said on Wednesday.
The company’s supervisory board had already approved a EUR400m ($US532.2m) plant in western India and management is sticking to that plan, a spokesman told Reuters after Germany’s Manager magazine had reported that Winterkorn had put the project on ice.
News agency dpa-AFX reported that VW had so far planned to build the Passat, Jetta and a special version of the Polo – in interviews Winterkorn has suggested there might be a special small car for emerging markets built in India.
According to Manager magazine, the Volkswagen board took the decision to rethink its strategy for India at a meeting at the beginning of March. The report’s source was somebody within the company.
The report said that Volkswagen would no doubt go ahead with plans to assemble cars in India but all details of the strategy would be reconsidered.
The original plan called for around 110,000 cars a year to be built from 2009 for sale in India. A further EUR100m would be invested in developing a dealer network, according to the magazine.
An earlier decision to set up a plant in Andra Pradesh ended up at the centre of a bribery scandal that led to the resignation of India’s major industry’s minister, who was also acting as Volkswagen’s Indian agent.