Volkswagen, Suzuki working on small car for India, could replace Alto

Honda Insight

Earlier this week, Volkswagen and Suzuki confirmed that they have reached an “understanding to establish a close long-term strategic partnership.” As a part of the partnership, Volkswagen will take a 19.9 percent stake in Suzuki. Both companies said that as a result of their collaboration, the two are going to take a joint approach to target demand for more environmentally friendly compact vehicles.

According to a report by the Economic Times, both automakers will develop a new compact car for India that would cost between $4,300 and $5,400. It is said that Suzuki, which is the parent of India’s Maruti Suzuki, could use the car to replace the Alto.

“At some point we will need a replacement for the Alto. That price range is the entry level for Indian customers today, so we can’t leave that segment open,” R.C. Bhargava, Chairman of Maruti Suzuki told the Economic Times.

At double the price of the world’s cheapest vehicle produced by Tata, the model will not compete with the Nano.

– By: Kap Shah

Source: Reuters