Volkswagen Group to invest 1 billion to expand its India operations A new Kylaq based compact SUV could be launched in 2026 CMP-21 platform based multiple SUVs and EVs will be launched in India
Skoda Auto Volkswagen India Pvt Ltd (SAVWIPL) is aiming to further expand its market position by introducing multiple products under its new INDIA 3.0 roadmap. The world’s second-largest carmaker will invest an additional 1 billion (around Rs 10,000 crore) to expand its India operations. The company will introduce multiple new premium utility vehicles, including SUVs and electric vehicles.
VW may launch Kylaq based SUV
The Kylaq compact SUV has helped Skoda to register the highest sales growth in May 2025. The company recorded sales of 6,740 units in May 2025 as against 2,884 units in the same month last year, reporting a YoY sales growth of 133.7 percent.
Seeing the massive success of Skoda Kylaq, Volkswagen is also planning to launch its own version of the compact SUV in India. The new model could be the VW Terra, which has recently been launched in select international markets. The new compact SUV is expected to be launched in the country in 2026. Once launched, it will rival the Hyundai Venue, Kia Sonet, Mahindra XUV 3XO, Maruti Brezza and Tata Nexon.
The new compact SUV will be based on the modified version of the MQB AO IN platform, which underpins the Volkswagen Taigun and Virtus. The new VW Tera has a modern design with inspiration from the all-new Tiguan SUV.
The cabin layout of the Tera is inspired by the VW ID electric SUV. It features a freestanding 10.25-inch touchscreen infotainment unit, a 10-inch fully digital driver’s display, leather upholstery, ambient lighting and ADAS suite.
The compact SUV will be powered by the same 1.0-litre, 3-cylinder turbo petrol engine that produces 115bhp and 178Nm of torque. Transmission choices will include a 6-speed manual and a 6-speed torque convertor automatic.
India 3.0 Roadmap
Under the new India 3.0 roadmap, the German brand will target premium SUVs and MPVs across electric, hybrid and ICE variants. These models will be based on the CMP 21 platform, which is an affordable EV architecture designed for India. The platform will be used to develop mid-sized UVs measuring 4.3 to 4.8 meters.
SAVWIPL is also looking to launch Audi cars based on the CMP 21 platform. Adding to it, the Group is also planning to start local assembly of Porsche models in India.
Source - ET AUTO
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