NEW DELHI: Firming up its India plans, Europe’s largest car maker Volkswagen AG has signed its first sourcing agreement with the Delhi-based Minda Industries (MIL) for automotive components.
MIL has signed the Rs 60 crore ($15 million) agreement to supply headlights and rear combination lamps to Volkswagen’s upcoming cars in India scheduled to be introduced in late 2009 and another car that will be made in Russia. The German company is finalising a bunch of suppliers for its India-made cars, which will be rolled out from its Pune plant which is under construction.
Volkswagen India president and managing director Joerg Mueller said: “We plan to source largely from local vendors to keep our car prices low and competitive. We will launch Polo in two variants, a small car and a sedan sometime next year. We are working on a suppliers chain.”
MIL, part of the Rs 1,000 crore NK Minda Group, will also supply the rear combination lamps for a car which will be manufactured by Volkswagen in Russia.
When contacted, MIL managing director NK Minda said: “We have signed a letter of intent with Volkswagen to supply automotive lighting, which will be made at our manufacturing plant in Pune. We will be working closely with Volkswagen’s head office at Wolfsburg in Germay to develop the style and prototype of these products to meet quality and cost parameters. It’s an all new technology that we are developing for them which will be used for the first time in India.”
Volkswagen like other international car makers like General Motors, Ford Motor, Hyundai Motors, BMW and Daimler Motors has opened an international purchase office (IPO) in Mumbai. “We have big sourcing plans from India. We are looking for all kinds of automotive components for the Volkswagen Worldwide Group and scouting for vendors here,” Mr Mueller said.
It is looking for tyres, panels, automotive electronics, seats, windscreen and other automotive components and critical engine and gear parts from India. Minda is also in the race to supply these components.
“We have also submitted request for quotations (RFQ) to supply automotive switches, horns, locks, electronic starter motors & alternators for Volkswagen’s domestic and global operations. We will invest Rs 100 crore in the next 15 months to expand our facilities at Pune and Pantnagar to meet demands of Volkswagen and other car makers,” Mr Minda said.
