Volkwagen opened its new plant in India today at Chakan near Pune. The new plant is worth 580 million Euros and has a capacity of manufacturing 110,000 cars annually. The new production at the plant will begin with Skoda Fabia, the hatchback model from the Volkswagen group company, Skoda Auto AS. The new production will begin in May and the plant shall subsequently start manufacturing Volkswagen Polo in 2010. The plant shall employ nearly 2500 workers by December 2009.
Volkswagen is Europe’s largest car manufacturer and marks a strong presence there. It is also the biggest overseas car maker in China. It now aims to gain similar market strength in the Indian market. It plans more investments in emerging markets like India to offset tumbling demand at home.
“China and India are the two standout markets among emerging economies that will perform relatively better than anywhere else,” Tim Armstrong, director of Global Insight Inc. said from Paris. Volkswagen is “taking a long-term strategic position in India.”