A Cheap VW Is On The Drawing Board

Renault did it with the Dacia brand. Nissan did it with the Datsun brand. And now, Volkswagen will be doing it too. The rumour has been buzzing around the automotive world for some time that VW is planning to produce an entry-level car after seeing the success that its counterparts had with budget sub-brands for emerging markets in Latin America and South East Asia. The decision makers in VW are finally coming close to signing off on the cheaper VW addition after struggling to meet internal cost targets for a vehicle that places in a price bracket below what they are used to.

Once upon a time ago, in 1937 to be exact, VW was founded amidst a market of luxury cars which the average German could not afford. The iconic beetle-shaped vehicle was built to be a “people’s car”. Well, it has long since been anything but. For a time, the automaker did explore acquiring a stake in Malaysia’s national automaker, Proton, or partnering with Suzuki to produce low-cost cars, but the discussions bore no fruits...nor cars. The best way, it seems, is for VW to go at it alone.

VW has not provided many details but promises that they are working vigorously on the new budget vehicle that will sell for approximately USD8000. Price-wise, this will place the new VW vehicle well at the bottom of the VW product line-up, below the Up!, a two-door, city car, which won the 2012 World Car of the World Award, and costs USD13 000 upwards, and the much loved Golf, which won the same award in the subsequent year and has a price tag starting from USD20 000.

The budget VW will be manufactured in China where labour costs are low and where the market lies. The automaker only owns a sliver of the pie in other emerging markets like India and South East Asia, where cheap, no-frills vehicles dominate the market and which Datsun has been focusing on. Earlier this month, Datsun’s comeback started in India with the launch of Go, a large hatchback that retails for only USD5500 upwards, and will soon also be marketed in Indonesia. VW’s slightly pricier offering will have to top other budget vehicles with qualities that the German marque is known for – superior engineering and quality interior – despite the lower production budget. No wonder it took VW some time to figure it out.

VW said that the car will reach the market by 2016. Meanwhile, we will be keeping an eager eye on more details about this cheap car of superior quality that we are hoping it will be.

image: carstyling.ru