Latest Car News in India

Volkswagen mulls Gujarat as the next location for new manufacturing plant

Gujarat is on verge of being the hub for automobile manufacturing and assembling of cars. Auto companies are vying to constitute their manufacturing plants in Gujarat; few of the auto makers have already constructed facilities in Gujarat or are eyeing to zero in on Gujarat to open assembly units or manufacturing plants. Another car maker who is pondering to build new manufacturing plant in Gujarat is none other than the German auto major, Volkswagen. Tata Motors and General Motors have already begun their operations in Gujarat, however, India’s largest car maker Maruti Suzuki India is also evaluating options to set up a manufacturing unit in Gujarat.

Though Volskwagen’s plan to open facility in Gujarat is still under consideration, the company will schedule meetings with Industries Department in Gujarat to come to a conclusion. Volkswagen has explored sites at Vadodora and Ahmedabad, the maker of Volkswagen Vento and Volkswagen Polo mentioned that it is not looking for sites in any other state for the new facility. However, there is no confirmation in this regard from the company side. Volkswagen currently has two manufacturing units in India which are located in Chakan near Pune and the other one is in Aurangabad.

The manufacturing capacity of these two plants stands at 1.3 lakh units. There is a scuffle between Volkswagen and the government officials regarding the discontinuation of VAT benefits. Previously, the Government of Maharashtra used to recoup the VAT paid on all the vehicles manufactured in Maharashtra. Now the policy has been changed and vehicles sold within Maharashtra qualify for this benefit, this led to a fury amongst the Volkswagen authorities.