If you are still hoping to see new generation of Volkswagen Polo in India, we have an unfortunate piece of news. The company has confirmed that it will no longer manufacture and sell compact hatchbacks in the Indian market.
The automaker has taken this hard decision relating to powertrains, dimensions, and emissions. In India, small cars measuring not more than 4 meters in length attract lower GST rates, which requires international marketers to invest highly in small car segments. Volkswagen believes that the restrictive and mandatory rules decided by the government for small cars need too many investments and engineering, which is not a feasible decision for the company.
As of now, the seventh generation of Polo is more than four meters. Suppose, the company even intends to launch it in India, in that case, the manufacturer has to re-engineer the car heavily to fit it into the sub-four-meter segment to get advantages of the GST bracket.
Moreover, Volkswagen feels that the investments required for re-engineering this new version of Polo for the Indian car market will not get satisfied with the projected sales volume of Polo in India, which might gets over as a loss-making proposition for the company.