Volkswagen is planning a budget brand for the Indian car market. They hope to rival Renault’s brand Dacia in the country. Adding to the Volkswagen Group, it would be the 13th badge under the German brand’s name.

Ulrich Hackenberg, the Research and Development Chief for the Volkswagen Group said that the company are always looking at new opportunities to help the company grow. He said mentioned that their new line of cars would be “below prices we currently sell at”, paving way for a budget brand. He went on to say “There is now a big segment growing below us. In China for example, we’re selling cars for less than ever for 8000 Euros but there are brands selling for 6000 Euros. It makes sense to rival these brands, we’re analysing it and pre-thinking it.”

In terms of launching new budget models, Mr Hackenburg stated that Volkswagen is not far away at all in terms of doing so. They have the technology ready from models within the group. In that sense, no vehicle needs to be built from scratch. He said “We have technology that has been invested in and improved over time, and it is easy to share costs with parts that are already available. So you don’t need to make new investments in the technology.”

It is not yet known which models would be released yet. Sources claim that a saloon, estate and a multipurpose vehicle could be released from the new Volkswagen brand.

Volkswagen’s Indian budget brand will go head to head with Romanian based Dacia. The vehicles are not expected to exit that specific continent, targeting emerging markets like India and China, spreading throughout the rest of Asia.

Using previous parts and technologies helps to save money on research and development as well as time. Now is the right time to enter the Indian car market, with plenty of room for foreign automakers to make an impact, given that the auto market is still emerging.

It would appear that everyone is backing Volkswagen to succeed in India. They are Europe’s largest car maker as well being the world’s second largest car maker. They have all the experience and tools needed to succeed, not to mention the financial backing.