Volkswagen Is Looking For A Partner To Build EVs In India: Report

Volkswagen is looking for a partner in the Indian automotive industry, separate from the Skoda Auto Volkswagen India Pvt Ltd (SAVIPL), according to a report by Autocar Professional. According to sources, Volkswagen is looking to dilute its stake in SAVIPL to its potential partner, if it finds synergies in platform sharing and parts sourcing.

A source close to Volkswagen said, “Key executives from Germany are open to having conversations with the right business groups to explore an alliance in the country to share the significant investment needed to transition from ICE to EV vehicle platforms in the future.”

Volkswagen is looking at building more vehicles using its MQB A0 IN platform for Skoda and Volkswagen, while also looking at investing in locally manufactured electric vehicles for the domestic market and exports from India. For electric vehicles, Volkswagen is looking to make a new, low-cost EV architecture (MEB21G) and this is said to require an investment north of EUR 1 billion as it is expected to spawn four SUVs for Skoda and Volkswagen by 2030.

Given the significance of this investment, Volkswagen is aiming to mitigate its risk and help in any future investments. “The idea is to share technology as well as risk emanating out of transitioning to the zero-emission space, which may be relatively slow in India, hence a stake sale seems practical, provided there is a win-win,” added another source.

On the speculation of Volkswagen looking for a new partner, Piyush Arora, MD and CEO, SAVIPL, commented, “The Volkswagen Group is one of the most successful vehicle manufacturers in the world. Within the Volkswagen Group, Skoda Auto is responsible for the important Indian market. We are always exploring new business opportunities worldwide, however, please understand that we generally do not comment on speculative news.”

Recently, Volkswagen has signed a supply agreement on EV components with Mahindra. With this, Volkswagen will provide components of its MEB architecture to help Mahindra build its electric INGLO platform. Mahindra has become the first external partner of Volkswagen to use its unified cell concept, which is the core element of its battery strategy. This supply agreement will span several years and have a total volume of 50 GWh over a lifetime.

Source: Autocar Professional