Volkswagen’s Indian subsidiary, Skoda Auto Volkswagen India Pvt Ltd (SAVWIPL), has received a significant boost with a $1 billion investment from the Volkswagen Group in Germany. This investment is part of the company’s India 3.0 strategy, which aims to expand operations and increase sales in the Indian market. The strategy is expected to focus on the premium SUV segment and affordable sub-4m segment, with a holistic roadmap to cater to a wider demographic.
The investment will be spread over a period of five years, starting from 2028, and will also involve a push towards electric vehicles. The company plans to use an India-specific CMP 21 platform to manufacture electric vehicles, which will be priced competitively due to localization. The platform will be used to spawn Skoda, Volkswagen, and even Audi vehicles.
SAVWIPL currently operates multiple Volkswagen Group brands in India, including Skoda, Volkswagen, and Audi. The company has been experiencing a slowdown in sales, and the investment is expected to help reverse this trend. Skoda is currently the 7th best-selling car brand in India, while Volkswagen is the 10th best-selling brand. The combined sales of both brands stood at 9,588 units in May 2025, with the Skoda Kylaq constituting 51.61% of the total sales.
Under the India 3.0 strategy, SAVWIPL is expected to launch new locally manufactured vehicles, including a sub-4m SUV from Volkswagen, which will be based on the Skoda Kylaq’s platform. This will be the most affordable Volkswagen offering in India and is expected to be a primary volume generator. Additionally, facelift versions of existing models such as the Skoda Slavia, Volkswagen Virtus, Kushaq, and Taigun are also expected.
The investment will also enable SAVWIPL to fast-track more Porsche models for local assembly in India, with a focus on Porsche SUVs such as the Macan and Cayenne. Overall, the $1 billion investment is expected to provide SAVWIPL with the necessary capital to expand its operations and portfolio, increase sales, and become a more competitive player in the Indian market.