P R E S E N T E D BY

STRATEGY AT VOLKSWAGEN GROUP

INDIA

Contents

Volkswagen –The GroupVolkswagen Group IndiaCorporate Strategy

Mark 18 Plus StrategyBusiness Strategy

Skoda Audi Volkswagen India

Functional StrategyBrand EquityCommunication, Pricing AND Distribution

Das Auto

Volkswagen Group

• Volkswagen Group is a German Automobile Manufacturing Group.

• 3rd largest automobile manufacturer

• Parent Company- Volkswagen AG

• Product range extends from low-consumption small cars to luxury class vehicles and trucks.

Cont…..

Group operates 60 production plants around the world.

Volkswagen AG, is globally represented by 9 brands- Audi, Bentley, Bugatti, Lamborghini, Scania, Seat, Skoda, Volkswagen Commercial Vehicles (Volkswagen Nutzfahrzeuge) and Volkswagen Passenger Cars.

Volkswagen Group India

Volkswagen Group India, the Indian subsidiary is a part of Volkswagen AG.

It has its headquarters in Pune, Maharashtra (India).

Volkswagen Group is represented by three brands in India: Volkswagen, Audi and Skoda.

Volkswagen Group is completing 10 years of its India journey which began with the entry of the Skoda brand in 2001, Audi brand and Volkswagen brand in 2007.

Cont…

It currently has 16 models in the Indian market.

Volkswagen Group are setting up dealerships spanning the entire country with Volkswagen, Skoda and Audi having in total around 70 dealerships in 56 cities across 18 states and 2 union territories of India.

Volkswagen Group have together sold around 19,000 vehicles in India in 2009, an increase of 1.4% over 2008 in a year marked by recession in the auto industry.

Cont….

Skoda entered the Indian market in 2001.

Its plant in Aurangabad, assembles a total of eight models including the Audi A6 and Audi A4 as well as the Volkswagen Passat and Volkswagen Jetta.

Group’s production facility near Pune in the Chakan Industrial Park is a key element in Volkswagen’s India strategy to establish a long term presence.

Cont….

Total sum invested of around INR 3,800 crore (580 million Euros) is the biggest investment of a German company realized in India so far.

The plant, one of the most modern in the Volkswagen Group has a high level of vertical integration.

Annual capacity of around 110,000 cars.

Corporate Strategy

Global challenges such as climate change and scarce resources demand sustainable solutions.

Volkswagen Group has been employing various methods to envisage the future and thereby enhance its competitive position.

Volkswagen Group has charted a clear course with our “18plus” strategy.

MACH 18PLUS STRATEGY

Focus lies on becoming an economic and environmental leader in the global automotive industry.

Strive for success in terms of profitability, customer satisfaction and quality, accessing new markets and increasing production output, and attractiveness as an employer.

The “plus” element stands for more entrepreneurial thinking, more synergies and more ecology.

Cont…

Volkswagen will harness the strengths of the Group and its nine brands with an environmentally-oriented model range .

Volkswagen has set its sights on new environmental benchmarks.

The company has earmarked annual expenditure for development and investments in new models and technologies in excess of €8 billion over the next few years.

Cont…

Boost the sales volume from present 6.5 million to more than 10 million cars.

The incremental volume aimed for will more or less come from Brazil, Russia, China and India.

India’s Contribution in 18plus Strategy

Indian car market is the 10th largest car market with annual sales of around 1.4 million cars.

The market size is expected to increase to 4 million cars by 2015.

Volkswagen aims to increase its market share from a meager 1% presently to 10 % in next 5 years.

VW picked up 19.9 per cent stake in the Suzuki Motor Corp (SMC) for USD 2.5 billion last year.

Maruti Suzuki India is the crown jewel of the Japanese car maker.

Volkswagen is open to jointly developing products with Maruti Suzuki India, as part of its efforts to achieve synergy with Suzuki Motor Corp at the global level. 

Business Strategy

SKODA AUTO INDIA• Launched its first product, the OCTAVIA, in

India in 2001.

• Was the only possible step to enter India.

• Skoda adopted a Focus Strategy approach relying on differentiation as a luxury car maker.

It now plans to come up with a new Fabia which will be more competitively priced and another small car priced between 3-5 lacs(by 2012).

AUDI INDIA• Audi is one of the world’s leading premium

brands.

• Basis of its success comprises pioneering concepts in the domains of advanced technology and design.

• Audi has been selling its products in Indian market since 2004.

For this Audi AG has earmarked investments of up to €30 million (Rs174 crore) by 2015 in its local operations.

Also Audi India plans to come up with a car in corporate entry level i.e. Toyota Camry following the lead of BMW.

VOLKSWAGEN INDIA• Volkswagen is the highest volume brand of

VW Group.

• Volkswagen presents itself in a variety of segments as a premium manufacturer of high-volume models.

• As a first step, the Volkswagen brand launched the globally successful Passat in 2007.

Cont…

To expand its portfolio and cater to the mid segment, Volkswagen launched one of the brand’s bestselling models, the Jetta, in India in July 2008.

Iconic New Beetle and the high-end SUV Touareg were introduced in December 2009.

Also available is the high-end automobile Phaeton.

From December 12, 2009 the new Pune plant has started rolling-out the hatchback version of the Volkswagen Polo.

Cont….

After Polo, Vento is VW's second car targeting the mass market.

It will be positioned at the upper-end of the country's mid-sized sedan segment.

Volkswagen India has adopted a top-down strategy to arrive at competitive pricing.

It is directly pitted against market leader Honda City, Maruti’s SX4, Ford Fiesta etc.

Volkswagen India in Numbers• VW has sold a total of 3,037 units in the country in 2009, of which 58 were

Beetles, 25 Touaregs, 2,342 Jettas and 613 Passats. This is a 95 per cent increase in sales since 2008 when they sold 1,566 cars.

• Volkswagen India sold 2,597 cars in July 2010.

• Since its launch in February, Volkswagen has sold 1,599 Polos so far.

• There are already 10 units of the Phaeton (priced @75 lacs) in the Indian market.

• 50 confirmed orders for the Beetle, with a four-month waiting period.

• 50 confirmed orders for the Touareg.

Ansoff Growth Strategy Matrix

Market Penetration

Product Development

Market Development Diversification

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Functional Strategy

MARKETING STRATEGY OF VW INDIA• China is the 2nd largest market for VW Group after

Europe.

• Volkswagen plans to use its learning in China in India.

• Aggressive price tags and high-decibel advertisements.

• Volkswagen’s strength lies in the mass market. Its name, after all, means people’s car in German. 

Brand Positioning

Value Prestige

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When VW started out in 2007, low brand awareness was one of the key concerns.

Thus Volkswagen came out with 13 advertisements in a leading English newspaper.

 It told readers all they ever wanted to know about Volkswagen — how the name came about, its product line and so on.

Cont…

By the time the campaign ended, Volkswagen had used 18,000 television spots, 144 insertions in broadsheet dailies, 50 insertions in magazines, 280 out-of-home sites and 23 digital portals.

To improve brand recall, the next campaign showed all Volkswagen cars: The Beetle, Passat, Jetta and Touareg.

Customer based brand equity

The Volkswagen customer based brand equity is equally strong on the left and right hand sides.

It is also strong from bottom to top, enjoying the highest brand awareness of a carmaker as well as high repeat purchase rates and customer loyalty.

To a certain extent Volkswagen has successfully focused on both the superior product attributes and the imagery associated with owning and driving a Volkswagen.

Communication @ VW

Most of the Volkswagen communication takes place through print media in magazines and newspapers.

This is supported by communication through TV

advertisements and point of sales promotion.

Now a days a good company has a state of the art web portal ,Volkswagen websites are highly informative, interactive and a pleasure to watch.

One can get any amount of detailed information regarding the prices, features, retailers, and support services etc.

PRICING AND DISTRIBUTION

Volkswagen India Private Limited currently has more than 70 dealerships in 56 cities across 18 states and 2 union territories of India.

There are company specified retailers and distributors through out the world who are in constant touch with the parent and comply implicitly.

Dealers also have round the clock servicing and repair.

Volkswagen also has a used car portal where one can choose and buy his/her appropriate model. 

Mr. Lutz Kothe, Head of Marketing said…

Volkswagen was the fi rst company in India to use LinkedIn Recommendation Ads, and the campaign was a success.

We went in with a goal of inspiring 500 recommendations among current and prospective car buyers.

In less than 30 days, over 2,700 Volkswagen fans had stepped forward to recommend their favorite cars and share these recommendations with their professional networks.

Unique Advertise’g Strategy

THANKYOU