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“We’ll try to close the gaps in our after-sales process”
Neeraj Garg, Member of Board & Director, Volkswagen Passenger cars, talks about the automaker’s plan of action in the all important Indian market
Issue Date - 30/05/2012
B&E: As compared to what Volkswagen has achieved in markets like China and Europe, it is still early days for the automaker in the Indian market. What it is that VW wants to achieve in India?
Neeraj Garg (NG): As a company, we are looking at becoming a key driver of the growth in India’s automobile market. After we started launching products in the high-volume segments three years back, we have been able to gain a strong position in the Indian market. As compared to a sales volume of 3,000 units in 2009, we sold 33,000 in 2010 and 78,000 in 2011. We are today the sixth-largest passenger car manufacturer in the country. Is this where we want to stop? Certainly not!

B&E: Globally, VW has a plan to become the market leader by 2018. While it is expected that the company will be able to achieve that milestone before the set year, what is your view on the market share that you would like to achieve in India by, say 2018?
NG: What I’d like to say is that if VW wants to keep growing, we will have to keep on expanding our sales volumes here. We are among the top three globally. And because India is a strategically critical market for us, we have to build a very strong footing for ourselves in this domestic market. Three years back, the awareness level of our brand was single digits. Hardly anyone knew what VW stood for. Today, that awareness level has risen by 800-900%, which is a significant jump. Although in this respect we are still way behind companies like Maruti, Hyundai and Tata – whose awareness levels range from 90%-99% – I think we have been able to communicate well with our target segment. We have the potential to climb up the ladder. However, this process will take time. Today, we are catering to only 40% of the total market with our seven-product line-up. Hoping that the industry will sell more cars than the 2.2 million cars sold last year, all I can say is that we are right on track.

B&E: You have outpaced the industry in terms of growth over the past few years. What is the action plan for this year?

NG: This is the time to check whether we are ready for the long-term growth of the domestic market or not. We plan to fill the gaps in our system and consolidate what we have achieved so far in India. For instance, since our sales network has grown exponentially, there are gaps in the after-sales process. We will also be addressing issues like manpower training et al.

B&E: And what about the novelty factor, since your competitors have launched many new models over the past few months?
NG: All our products are new in any case. Vento is one year-old, Jetta is just six months-old and Passat is just nine months-old. India is very different from the developed markets where manufacturers have to snatch away market shares of other manufacturers to grow. India has a lot of headroom for all manufacturers to grow and we will be able to scale up volumes by opening more dealerships and infusing more efficiency into our system.

B&E: VW has been engaged in innovative marketing ever since you entered the market. Can you throw some light on your association with the IPL?
NG: It was tough to convince our global headquarters, as back in Germany, no one knows what is cricket. We had two choices – the Indian cricket team or IPL. We chose IPL. This association has helped us gain a lot of awareness. In fact, it also helped us create an action model strategy around the Vento. Last year, 50% of Ventos sold were IPL edition cars. This shows how the engagement with IPL has added value to VW.



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