The Hindu Business Line : Passat: The right product for entering India

Volkswagen’s entry into the Indian market is a case of being better late than never. For a company that was one of the first overseas entrants in the Chinese car market, and after holding a fairly dominant position in that country for the last nearly 23 years, Volkswagen has taken a quite a while to mark its foray into what is arguably the world’s second fastest growing automotive market.

Now that it has stepped in, it clearly has chosen the right product in the new generation Passat. Volkswagen also has a few small cars or small hatches in the Polo, Fox and the Golf, but though they may fall within the size parameters defined in India for such cars, in terms of price, features and performance they would be identified with cars in the premium sedan segment.

The current generation VW Passat code-named PQ46 was first showcased at the 2005 Geneva Motor Show. Volkswagen attempted to re-establish a new styling and design identity with the new Passat by borrowing some of the cues from its luxury saloon – the Phaeton. Unlike some markets like China, where the Passat is sold after considerable changes to the exterior and interior in order to suit the local tastes and preferences, the India-spec version is almost identical to the European version.

However, some of the features that will not make it into the Indian variants could include adaptive cruise control, where the use of radar is involved, and intelligent headlights with dynamic cornering lights that will need to be supported by global positioning systems. But, one innovative feature that will be appreciated by buyers here will be the electronic parking brake. If you are stuck in traffic while climbing that flyover or waiting at the signal while cresting the steep road, no problem, the electronic parking brake in the Passat engages at the touch of button mounted on the dashboard. And you need not be worried about sliding back because the electronic parking brake releases automatically when you hit the accelerator.

In terms of size, refinement and/ or pricing, the VW Passat will compete with cars such as the imported Toyota Camry and Nissan Teana saloons, the Mercedes C-Class, BMW 3-Series and its own group brand car – the Skoda Superb.

After holding on to a market share of nearly 50 per cent in its early years, Volkswagen lost market share in China with the entry of Japanese, Korean and Chinese competitors. It has gained back some of that market share during the last two years by re-engineering its cars dramatically to suit the market’s demands in terms of price, styling and features, so much so that, some of them may not even be identified as a Volkswagen by buyers in Europe.

Being the late entrant here, will VW India want to adopt a similar strategy for the Indian market or will it remain a niche luxury car manufacturer?

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