Volkswagen is the second largest automobile company in the world. However, in India, even after 18 years of presence, it has a minuscule market share of just 1%. Volkswagen merged the sister companies Skoda India and Volkswagen India into Skoda Auto Volkswagen India Pvt. Ltd recently.

The company has realised that while the market share of compact cars is falling, the market share of compact SUVs is in ascendancy. The reason may be several including the aspirational value of SUVs, better utility, more robust build and higher ground clearance. Driving on most Indian roads is akin to softroading and hence, no wonder, SUVs are popular.

Taking cognizance of this fact, Volkswagen Group has decided that all new cars developed and offered in India will be SUVs. No, lovers of Polo do not grieve because the company has stated that it will continue to develop and offer facelifts of the Polo, Ameo and Vento in India. But new models introduced will all be SUVs. The first new car expected from Volkswagen would be a compact SUV based on the MQB-A0 platform. This car is expected to be demonstrated at the Auto Expo in Delhi next February. Th new SUVs would sport both Skoda and VW badges. Volkswagen is aiming to compete against the Hyundai Creta and the Mahindra XUV 500.

Steffen Knapp, director, Volkswagen Passenger Cars, a division of VW Group Sales India Pvt. Ltd said, “We are not going to look at the small cars or the B segment sedan type categories anymore unless there is a strong business case for them in the future.”