Volkswagen Group proposes to infuse Rs. 700 crore for product range and production expansion in India
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In a bid to accelerate the growth pace in the Indian auto market, Volkswagen Group, the German based multinational automotive concern has announced an investment of around 100 million Euros amounting to Rs. 700 crore in the country in the coming two years to diversify the product range along with ramping up of production activities.
While speaking at the annual convention headed by the SIAM (Society of Indian Automobile Manufacturers), Mr. John Chacko, Chief Representative, Volkswagen Group India, commented, "We need investments in improving our facilities, doing minor model changes for our exports and other areas. We are investing about 100 million euros for the entire group in the next two years in India."
The company, which has marked its staunch presence in the Indian auto market with globally acclaimed brands, Volkswagen, SKODA and Audi confirmed that the group is currently not heading towards initiating other proposed high capital investments plans in India.
The automaker had earlier planned to infuse Rs. 2,000 crore for attaining step up in the production operations but had to stall the plan owing to the inconsistent policy decision in relation to VAT refund issue proclaimed by the government of Maharashtra.
In its endeavor to encourage investments in the state, the Maharashtra government refunded VAT paid on all the vehicles sold by the car makers, whose production facilities are located within the state premises. Later on, to the much dismay of Volkswagen, the government restricted the refund of VAT on the vehicles sold within the state.
Recently, Volkswagen has launched exclusive top-end variants of its Polo and Vento models, while Audi India is spearheading to grab the top spot in the country’s luxury car market and SKODA is anticipating a marginal growth due to exchange rate volatility.
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