MUMBAI, Sept 5 (Reuters) – Germany’s Volkswagen aims to further cut its dependency on Europe and will focus on emerging markets, including India, which it sees driving growth in the future, a senior company official said on Wednesday.
Rising incomes and new models are boosting sales of bigger sedans and premium cars in India, and more growth is expected as only 8 in every 1,000 Indians owns a car, compared with 300-500 in many Western nations.
Annual passenger vehicle sales in India are forecast to nearly double to 2 million units by 2010. More than two-thirds of the fast-growing market is for small cars.
“Clearly India is a fast developing, fast changing market with potential to grow, who knows two, three, four times,” Rose said. “We will begin slowly and steadily.” Sales of vehicles have been hit in recent months after India raised interest rates, making loans for automobiles more costly, while exports have been hit by a strengthening rupee.
Some 80-85 percent of vehicles sold in India are bought with loans.
Volkswagen also aims to launch a small car by 2009/10 to cater to the Indian market, the head of its India unit said, but did not comment on its pricing.
“We will bring a complete new car. It’s under development,” said Joerg Mueller, president of Volkswagen India Pvt Ltd.
“Let’s wait and see. It has to be competitive,” he said when asked about how much it was likely to cost.