Tata Motors and the VW Group have reached an agreement to jointly develop a range of models targeted for the Indian market.
The two companies have been in discussions for over a year, leading to the signing of a Memorandum of Understanding (MoU) last Wednesday in Geneva, as reported by Autocar India.
The deal is expected to be officially announced on March 10 and will include the sharing of components and technologies between Tata, VW and Skoda.
The VW Group initially suggested the joint development of the MQB-A platform but that worked out to be too expensive for the Indian market. Instead the new alliance will use Tata’s own Advanced Modular Platform (AMP) which has the flexibility to spawn a wide range of models and the cost advantage over the MQB-A.
Tata will also be responsible for the engines as VW’s powertrains are also said to be too expensive, especially for the local market. On the other hand VW will chip in other systems into the alliance, like its electrical architecture.
The models produced by this alliance will be targeted to India, opening a window of opportunity for VW and Skoda in order to become more competitive in this price-sensitive market.
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