With a growth of 38% registered in the first half of this year, Volkswagen is hoping to post decent sales number for the rest of the year too. While global economic scenario remains a matter of concern and so does the inflationary pressures at home, Neeraj Garg, member of board and director, Volkswagen passenger cars, Volkswagen group sales India, tells FE?s Shweta Bhanot that India will sail through the tough times.
Passenger car sales have fallen 16% in July. With the current interest rates and global economic scenario, what is the way ahead for VW?
If you see the growth in the segment we operate, it has been flat for January to July. The industry is doing 3,000 units per month in these segments. Fuel prices, coupled with interest rates, has impacted sales for the industry at large. Demand has definitely dampened and is falling month-on-month. We feel further de-growth would impact the industry significantly.
To minimise the impact of any recessionary pressure, we feel that the need is to remain fresh with the products and continue with our brand awareness exercise. India has seen a resistance to the earlier recession and we hope the same this time round. In terms of Volkswagen, we have seen a healthy sales growth of 38% in the last seven months this year, over the last twelve months. We have sold 45,000 units in the seven months of 2011 over 32,500 units sold in 2010 calender year.
What is your product pipeline?
Other than the all-New Jetta, we do not have any more models coming in this year. The sixth generation Jetta comes at a starting price of R14.12 lakh (ex-showroom New Delhi) and we will have four variants of it. We are following a top-to-bottom strategy and looking at getting the latest models for Indian customers. We have already sold 9.6 million units of Jetta in the world.
How much is the order backlog on your models?
Order backlog on our diesel models runs into two to three months. This is largely on Vento. The order backlog has come down from three to four months earlier on diesel cars. We are expanding our capacity at Chakan to meet the requirements. We have expanded it to 1,30,000 units per annum around three months back and will continue to review it to meet demand.
Would we see any price correction on your models?
We do not plan to reduce prices, but will run special schemes in the market as and when required.