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VW Loosens Reins with Skoda-Developed Car for India
Volkswagen AG’s vow to give its operating units more control is getting its first test through the strategic partnership announced in February by its Skoda unit and Indian carmaker Tata Motors Ltd.
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Volkswagen AG’s vow to give its operating units more control is getting its first test through the strategic partnership announced in February by its Skoda unit and Indian carmaker Tata Motors Ltd.
The two companies are developing an inexpensive car for the Indian market. A Skoda source tells Reuters the Czech company is evaluating whether the project could adapt to a vehicle platform developed by Tata.
Skoda has the authority to make “incremental” decisions about the program, the source says.
Until now, VW has maintained tightly centralized control over all vehicle development and marketing programs. Critics say the approach sometimes resulted in cars that cost too much and weren’t attuned to local market tastes.
The company’s namesake brand has struggled for years to develop its own low-cost car for emerging markets. Reuters cites the demise of the slow-selling Lupo minicar and the spectacular failure of VW’s small-car development partnership with Suzuki Motor Corp. in 2015.
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