Volkswagen India eyes speedy growth in exports

Volkswagen India is looking at another year of ramping up its export volumes at a fast pace from its Chakan (Pune) plant.

VW India’s total exports during FY2014-15 stood at 64,994 units, a growth of 95 percent over its exports of 33,330 units in FY2013-14. In April 2015, it shipped 8,068 units from its Chakan plant as against 5,827 units in April last year, thus marking a YoY growth of 38.46 percent.

An official spokesperson of VW India told Autocar Professional that “Volkswagen India is aiming to stay more or less on the same level of exports from the Pune Plant in FY2015-16 as in the previous year. We are currently exporting to over 32 countries across three continents of Asia, Africa and North America. The biggest export market for us is Mexico, which contributes to approximately 80 percent of our total exports. In Asia, we are exporting to countries like Nepal, Bangladesh, Sri Lanka and Taiwan. Furthermore, we are exporting to AGCC, South Africa and other African countries.”

While the company is looking at boosting its exports, it plans to add a few more export markets during this financial year. The spokesperson, however, refused to divulge details on this front.

VW India, which exports its Polo hatchback and Vento mid-sized sedan from its local facility, has seen a sharp jump in the exports of both these models. For FY2014-15, while the carmaker exported 56,064 and 8,930 Vento and Polo cars respectively, both models registered an impressive YoY export growth of 72.79 percent (Vento) and 911.32 percent (Polo) on their previous year’s export volumes.

Interestingly, for FY2014-15, VW India’s total exports of the Vento sedan stood more than four times than its total domestic sales during the year. According to SIAM data for the last fiscal, the company had sold 12,848 Ventos in India.

Additionally, the model also stood out for being the highest exported car in its category, which also includes rivals such as Honda City, Hyundai Verna, Maruti Suzuki Ciaz and SX4, Renault-Nissan’s Sunny and Scala models and others, for the last fiscal. SIAM distinguishes this category as mid-sized sedan with the car’s length in the range of 4250-4500mm and engine displacement of upto 1.6 litres.

In April 2015, VW India exported 7,673 units and 395 units of the Vento and Polo cars respectively, marking YoY growth of 34.71 percent (Vento) and 201.53 percent (Polo).

While the petrol variants of the Vento model dominate VW India’s total exports, it is the left-hand drive models dispatched to Mexico that contribute the most, said the official spokesperson. Of this, the 1.6- litre petrol variant (equipped with manual transmission) is the top exported model for VW India.

Make in India

One such India-made Vento was showcased to the Indian prime minister Narendra Modi when he, along with Germany’s chancellor Angela Merkel, had visited the Hannover Messe exhibition in April. While welcoming the Indian PM at its stand, the delegation had discussed the locally made Vento cars and VW’s approach of developing skilled workmanship in India. Prof. Dr Martin Winterkorn, chairman of the board of directors at Volkswagen AG, had said: “India is and will remain an important strategic growth market for the Volkswagen Group. We are convinced that Volkswagen will take on a key role in the Indian automobile market in the long term. We are driving localization in India forward with our new engine assembly plant in Pune.”

VW India, which currently has a mix of six engine options (three-cylinder, 1.2 litre petrol; four-cylinder, 1.2 litre petrol; four-cylinder, 1.4 litre and 1.6 litre petrol powertrains; four-cylinder 1.5 litre and 2 litre diesel engines) across the Jetta, Vento and Polo, began local assembly operations of its 1.5-litre diesel powertrain in January earlier this year. In terms of sales, this engine powers over 40 percent of all VW cars sold in India currently.

VW’s local manufacturing is expected to get a boost with its upcoming sub-four-metre compact sedan, which is expected to open the door for the local assembly of not only the petrol engines but also the gearboxes in the near future. To accommodate the production of cars for its increasing export orders and the upcoming compact sedan, the company will, in the near term, also boost its current annual production capacity of 130,000 units. 

Also read: VW India’s 500,000th car rolls out from Chakan plant