Skoda Auto Closes In on Next Phase of India Investment

Skoda Auto is moving closer to finalising its next phase of investment in India as it looks to expand its product and powertrain portfolio beyond the petrol-only range it currently manufactures in the country.

Internally referred to as India 3.0, the programme is expected to support a CNG-powered Kylaq in 2027 and the first of two locally manufactured battery electric vehicles in 2028.

Autocar Professional understands that the proposed investment could be around one billion euros and would go towards the design, development and engineering of new products. The programme is expected to spawn five-seat and seven-seat BEVs.

Skoda Auto Volkswagen India is examining different ways to fund and execute the programme, including bringing in a strategic partner.

“We know we have to do electric, so we are now thinking about what would be the best option for an electric car in India,” Martin Jahn, Skoda Auto board member for sales and marketing, told Autocar India on the sidelines of the updated Slavia’s launch.

Jahn did not disclose the size or structure of the proposed investment, indicating that different options remained under consideration.

In the near term, Skoda is evaluating a CNG-powered Kylaq. The additional powertrain would broaden the appeal of its first sub-four-metre SUV and give the brand access to a growing section of the Indian passenger vehicle market.

A locally manufactured BEV is expected to follow in 2028.

The electric vehicle programme is likely to use an adaptation of the Volkswagen Group’s China Main Platform, or CMP. The version being developed for India is referred to as the India Main Platform, or IMP, and will be tailored to local costs and market requirements.

The group intends to use the existing electric architecture while localising the platform, battery system and key components. A high level of localisation will be essential to price the Skoda and Volkswagen models competitively in India’s mainstream EV market.

As previously reported by Autocar Professional and Autocar India, Skoda Auto Volkswagen India is in the final stages of discussions for an alliance with the JSW Group. The proposed structure is likely to give the Indian conglomerate a majority stake and bring in capital for the Volkswagen Group’s expansion in India.

The discussions have yet to reach a formal conclusion, and the final structure and scope of the proposed alliance are still to be announced. Skoda Auto Volkswagen India is also examining other funding routes if the partnership does not materialise.

India 3.0 will follow the Volkswagen Group’s India 2.0 programme, which led to the development of the heavily localised MQB-A0-IN architecture. The platform underpins the Skoda Kushaq and Slavia and their Volkswagen siblings, the Taigun and Virtus. It was subsequently extended to the sub-four-metre SUV segment with the Kylaq.

The Kylaq CNG offers Skoda a nearer-term opportunity to widen its powertrain range. The larger commitment will be the development and localisation of Skoda and Volkswagen’s first mainstream BEVs for India.