Volkswagen sub-brand on schedule for 2016

THE Volkswagen Group is moving to establish an all-new sub-brand, as it continues to explore the potential of emerging markets such as India and China.

While no name for the brand has been offered as yet, head of the Volkswagen Group’s powertrain development, Heinz-Jakob Neusser, told Australian journalists that the plan was well under way.

“We are concentrating on what we can do in that area,” he admitted. “If you look at China, they have a steep increase in the number of large cities. A lot of people are coming from country to urban areas, and more than 60 per cent of car buyers in China are buying for the first time in their life a car.

“They have special demands for these cars size wise and so on, and this is a very special type of customer.”

Dr Neusser noted that sales for the entry level segment in China are increasing at a rapid rate, and that it was crucial to support the Chinese arm of the company’s business.

“To be able to compete in this field we need special knowledge, supplier bases and so on,” he noted. “We are very engaged in this, and you will hear from us when we have taken in mind what we want to do.”

While Dr Neusser didn’t want to confirm a timeline – “to tell you a fixed date is very difficult” – the project’s original deadline was 2016.

China will be the key market for the brand, according to Dr Neusser, who also said that Australia is not a priority market.

“The first market and the biggest market is China, but there are other countries that have similar demands,” he said. “Volkswagen is very globalised and engaged, and we are thinking of this for the whole world.

“Australia is not the priority on the road map which we have for these cars.” Volkswagen held six of the top ten sales spots in China last month in the sedan/hatch category, with products including Golf, Passat, Jetta and Bora. Its best seller was the Lavida, a compact four-door China-only sedan.