German automobile manufacturer Volkswagen (VW) Group will adopt a phased approach to localization of its battery electric vehicles (BEVs) in India and will await a strong business case before committing to offering affordable, ‘Made in India’ EVs, chairman of the board of management of Volkswagen Group, Oliver Blume, told ET.

Volkswagen, as the world’s second-largest automaker by volume, is confident about the Indian market’s fast-paced growth, making it the third-largest car market globally. However, Blume believes that a ramp-up curve is necessary for electric mobility in India, including the right products and positioning, especially to address the lower segments of the market.

The localization of EVs in India will also depend on the development of the charging infrastructure in the region. At the ‘IAA Mobility 2023′ auto show in Munich, the number of EVs on display has surpassed internal combustion models, reflecting a shift in car makers’ priorities. While Volkswagen has a clear EV strategy for various regions, a calibrated approach will be taken for India.

Globally, Volkswagen has committed to investing ₹180 billion over the next five years. The company’s brands are at different stages of transitioning to BEVs in different regions. In India, the company has already invested ₹5 billion over the past five years to launch locally made internal combustion engine models. Volkswagen is now preparing to introduce the VW ID4 and Enyaq iV, a five-seater e-SUV from Skoda Auto.

Thomas Schafer, CEO of Volkswagen Passenger Cars, stated that the company is unlikely to make any fresh investments in pure internal combustion engine models in India. Instead, the focus will be on conserving resources for BEVs.

The localization of EVs in India is part of Volkswagen’s overall global strategy to embrace electric mobility and contribute to sustainable transportation solutions.