Volkswagen mulls sourcing components from India

German luxury carmaker Volkswagen, which partly owns Japanese carmaker Suzuki, said on Tuesday it is exploring possibilities to source components from India using Maruti Suzuki's base in the country.

Volkswagen last year acquired 20 per cent stake in Maruti Suzuki India's parent Suzuki Motor Corp for about $2.5 billion (over Rs 11,500 crore).

"We have started talking to Suzuki in a lot of areas, including purchasing of component and technology development . . . India has a potential for synergies," Volkswagen Board member Jochem Heizmann told reporters at the 10th Auto Expo in New Delhi.

The company, which unveiled its hatchback 'Polo', will have a localisation of component to the tune of 50 per cent in the small car.

The car would be produced from its Pune facility.

Asked if the company would utilise Maruti Suzuki's vendor network, Heizmann said: "Maruti sells over 50 lakh cars in India and it is a different volume altogether. We can have purchasing synergies with the company."

He said the company plans to increase the localisation of Polo up to 75 per cent in the next three years and 'Maruti Suzuki may help in accelerating the localisation further'. Heizmann, however, declined to give any possible time frame of starting the sourcing of components or any possible volume.