Volkswagen to stop development of combustion engines by 2026: What it means for Indian buyers

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Volkswagen will not develop any new petrol or diesel (fossil fuels) engine models after 2026

Volkswagen’s decision to roll out its last internal-combustion-engine cars in 2026, before shifting completely to electric cars, will limit choice for its buyers in India, where it has promised to invest crores of rupees.

The automotive giant made the announcement at a conference held at its headquarters in Wolfsburg, Germany.

This means that Volkswagen will not develop any new petrol or diesel (fossil fuels) engine models after 2026. Only the then-existing models powered by fossil fuels will remain under production. All new model development will move to fully-electric platforms.

The move comes less than a year after the troubled group announced investments totalling 1 billion euro in India as part of its India 2.0 project aimed at reviving its beleaguered operations here.

“The year 2026 will be the last product start on a combustion engine platform,” Volkswagen’s Strategy Chief, Michael Jost, said.

The company’s senior management, at a press event in India last week, did not highlight the group’s plans for green mobility, including the launch of electric and hybrid vehicles in India. Volkswagen’s competitors in India, on the other hand, are planning a series of launches in the next two years.

The group is focused on rolling out petrol and diesel-powered cars and SUVs that will be partially developed at an engineering center in Pune. For lack of charging infrastructure and an allied ecosystem to sustain it, some manufacturers have shown little interest in launching electric vehicles in India.

The Škoda-Volkswagen combine is presently working on two sports utility vehicles (one for each brand) using the MQB A0 IN platform that will be ready for launch in 2020, just after the pan-India rollout of Bharat Stage VI emission norms.

Volkswagen was forced to reroute its focus on India a couple of years ago after a failed attempt at forging ties with Tata Motors. The tie-up was aimed at producing and selling an affordable range of cars and SUVs, perhaps using a common platform that would help bring down the cost of manufacturing.

The MQB platform was proving to be too expensive for India for Volkswagen at the time. To be sure, the group has decided against venturing into the low-cost segment in India and instead keeping both Škoda and Volkswagen as premium brands.

So the Polo will remain Volkswagen’s entry-level car for the Indian market, but Škoda has not committed to a hatchback as yet.

The Indian market is dominated by cars measuring under 4 meters in length, controlled tightly by Maruti Suzuki, followed by Hyundai. More than 80 percent of yearly volumes in India come from the less-than-4-meter segment.