Volkswagen eyes to increase component sourcing from India

Thursday 08 December 2011, 12:16 PM by Vikas Yogi

The Germany based automaker Volkswagen AG, which is the largest car maker in the European market, has said that it will increase the volume of parts sourced from India. The company will be utilizing this increases number of parts for its global operations.

Moreover, the firm is looking forward to triple fold it yearly component sourcing from India, enhancing it to more than 300 million euros (Rs 2,074 crore), over the period of coming 3 to 5 years. The company, which currently has about 100 component suppliers, plans to take the number of its suppliers to 200. The move will be taken in a bid to enhance the range of its spare parts for the global market.

In India, the company is looking forward to enhance the local content in the production of its cars. By sourcing cost effective components, the company is eying to take the localization content level in its prospective UP! model, which is expected to be launched in the country in next few years.

While speaking to ET, Volkswagen group India, executive director for components purchasing, Mr. Mahesh Kodumudi said, "We are still seeing India as a very competitive sourcing base - there's a cost advantage of at least 10-15% over Western Europe. And having worked with Indian vendors over the past few years, their capabilities to have matured and we do see them playing a bigger role."