With almost Euro 1 billion allocated for the India 2.0 project nearing completion, Skoda Auto Volkswagen India, the leading entity of the Euro 272.9 billion Volkswagen Group in the country, is on the verge of finalizing the next phase of investment. Multiple projects or platforms are likely to be introduced to sustain the product-led momentum for the coming decade.
In contrast to the previous parallel track approach, where Skoda and VW had products in similar market segments, such as Kushaq and Taigun, Slavia and Virtus, the group is transitioning to a twin-track approach. Skoda will continue investing in internal combustion engine vehicle (ICE) architecture, while the parent brand Volkswagen will focus on electric vehicle (EV) architecture for the Indian market.
Several critical steps are already being explored. Skoda Auto is studying the MQB A0 37 architecture for the Indian market, enabling the transition to larger and wider vehicles with advanced electrical and electronics architecture. This platform is also adaptable for a hybrid powertrain.
On the other hand, the Volkswagen brand plans to localize the MEB21G electric vehicle architecture to enter the rapidly growing SUV EV space in India. Skoda Auto has decided to develop the EV independently, with the first vehicle under the Volkswagen brand expected to hit the road in 2026.
This means that future vehicles will be based on three different architectures: MQB A0 27, MQB A0 37, and MEB21 G for electric vehicles.
Klaus Zellmer, the global CEO of Skoda Auto, emphasized that while the internal combustion engine is not the future for Skoda, it remains a clear part of the future for profit reasons. He stated that the future is electric, with legislation determining when the last combustion engine model will be built, estimated to be 2035 in Europe.
Skoda Auto Volkswagen India aims to speed up its operations and is considering a new platform beyond the current one used for models like Kushaq and Slavia. Zellmer highlighted the importance of developing competencies and keeping projects going. Skoda Auto considers India its third-largest market in terms of volumes outside of Europe and aims to capture a five percent market share by the end of the decade, necessitating the introduction of new models.
Exports are also a critical aspect of the strategy to bring in much-needed volumes, build scale, reduce costs, and include EVs in the thought process. Zellmer expressed the brand’s interest in exploring the export business model with EVs, leveraging India’s favorable production costs.
