Volkswagen ready to start development on affordable car concept image

Looks like Renault’s budget car brand Dacia’s success is making the competition restless – now Europe’s largest automaker, Volkswagen has decided to make its own budget car for the very important emerging markets.

According to Hans Demant, the Volkswagen official that heads the entire project, the company has already set up its basic overall concept and design, after it has been struggling for more than a year to reach its internal cost targets.

“The concept and design are now in place,” Demant said in an interview on the floor of the Beijing auto show. “We will produce all components in China.”

The car should retail at a price set between 6,000 ($8,300) and 8,000 euros, with its production set for China – which is besides the world’s largest automotive market also the biggest when it comes to such affordable cars.

The executives comments signal the company is now more positive about the outcome of the project, as during the Geneva motor show in March, Volkswagen’s development chief Heinz-Jakob Neusser said that reaching the cost goal was actually very difficult – and if the target is missed he would not approve the car.

Accoridng to analysts and forecasters, Volkswagen needs a good budget car, as its goal of becoming the first automaker in the world would be compromised other wise – the company has problems imposing in such emerging markets like India or southeast Asia – which are markets where buyers mostly go towards lower budget cars.

Via Automotive News Europe