In accordance with a top executive, the Volkswagen Group is in the process of finalising new investments to manufacture electric vehicles (EVs) in India, among other things. The German automaker is preparing to debut its first electric vehicle, ID.4, in 2024, after reviving sales volume in the domestic market with the introduction of new models under the India 2.0 plan.

While the ID.4 will be produced in Aurangabad, Maharashtra, from imported parts and components, the business intends to deeply localise the EVs it debuts in the mainstream market after 2025.

Ashish Gupta, brand director, Volkswagen Passenger Cars, India, declined to identify the amount of investment the business will make in India to manufacture EVs, but stated that the objective is to localise to the greatest extent feasible in order to operate sustainably in the market. According to industry estimates, the localization of an EV platform capable of producing two vehicles required a minimum expenditure of around 9,000 crore (one billion).

"You have to start doing it (planning) now to be able to bring a mass electric car, in the timelines that the industry is looking at somewhere in between 2026-27," Gupta told ET. "We are looking at similar timelines."

Over the next three to four years, the Indian market will see the introduction of 46 electric vehicles. Gupta stated that while the EV segment is developing quicker than predicted, electrification in the automobile sector would "happen in steps" since the ecosystem is not ready.

"The supply base is not ready. As much as 50% of the cost of an electric car is the battery. Unless mass localisation of battery manufacturing happens in India none of the OEMs (original equipment manufacturers), not only us, will be able to do mass electrification," he said.