Volkswagen wants you to know it’s “evaluating” ways to sell more electric cars in India: importing finished models, assembling them locally from shipped-in parts, or eventually building a homegrown EV from scratch. That’s the news, based on an interview with Skoda Auto Volkswagen India’s chief published this week. It reads like a fresh strategic pivot. It isn’t. Volkswagen’s own India boss laid out this same three-step plan, almost move for move, back in December 2022. Four years, one pandemic recovery, and several rounds of Indian tariff drama later, the company is still evaluating. That’s not a strategy. That’s a company that can’t get out of its own way, and this time the method it’s floating is the same one Indian customs officials say cost the treasury $1.4 billion.
The Announcement, and Its Ghost
Piyush Arora, the managing director and CEO of Skoda Auto Volkswagen India, told Business Standard this week that the company is weighing which product makes sense to localize for India’s EV market, which analysts expect to reach 17 to 18 percent penetration by 2030. Arora laid out three options: bring in global EVs as fully built imports, assemble vehicles locally using imported components, or eventually build a fully localized EV for the volume segment.
Go back to December 2022, and Arora described nearly the same three-step approach to Skoda’s own corporate media site: bring in EVs as imports first, shift certain products to local assembly, and eventually move a high-volume EV into full local production. In the years between those two statements, Volkswagen brought over roughly zero mass-market EVs to India. The only electrified products Indian buyers could actually get from the group were the Audi e-tron and Porsche Taycan, cars priced for people who don’t need an EV to save money on fuel.
How India Actually Prices a Car, and Why That Matters Here
This is the part a press quote never explains, and it’s the reason the phrase “local assembly using imported parts” is loaded language in India. Duty on a fully built imported car can run well past 100 percent. Import the same car as an unassembled kit of major components instead, and the rate drops to roughly 30 to 35 percent. Classify the shipment as ordinary parts rather than a kit, and it falls again, closer to 15 percent. That gap between tiers is enormous by design. It exists to reward companies that actually build things in India rather than just bolting together boxes shipped from Europe.
That gap is exactly what Indian tax authorities allege Skoda Auto Volkswagen India exploited for years with its combustion-engine lineup: importing what customs officials describe as nearly complete cars, split into shipments and labeled as ordinary parts, to dodge the higher kit-import rate. The bill, issued in 2024, ran to $1.4 billion. Volkswagen sued to quash it, calling the demand “impossibly enormous” and insisting it fully complied with Indian law. As of this month, a court has yet to rule.
So when the same company says its EV plan for India includes assembling vehicles locally using imported parts and components, that sentence is not neutral. It describes the identical customs gray zone the company is currently fighting a nine-figure legal battle over, just with battery packs standing in for engine blocks.
The Real Deadline Nobody Quoted
Buried under the EV talk is the actual forcing function: Indian emissions rules are set to tighten in 2027, pushing every automaker in the market toward cleaner powertrains whether their India strategy is ready or not. Volkswagen also needs a way to fund whatever comes next. Despite more than two decades in India, and a year in which profit rose 50 percent as sales doubled, the group’s scale in the world’s third-largest car market still isn’t, by its own executives’ admission, meaningful. Talks with Mahindra for a local partner collapsed back in 2022. Now Skoda’s global CEO says Volkswagen is negotiating a joint venture with steel-and-autos conglomerate JSW, one in which JSW, not Volkswagen, would hold the majority stake.
Read that again. The company weighing whether to import, assemble, or build EVs in India is simultaneously trying to hand the keys to a local partner because it hasn’t made the business work alone. General Motors and Ford already ran that experiment and left the country. Volkswagen is trying hard not to be the third.
None of this is happening in isolation. Volkswagen already knows how this plays out in Europe, where it pushed Brussels hard for tariffs against cheap Chinese EVs, then watched an Audi-badged, China-built model undercut its own German-built lineup anyway. It’s also increasingly a company leaning on platforms with roots outside its home market, a pattern showing up across the industry as legacy brands lean on engineering that traces back to China. India is getting a regional flavor of a global problem. Volkswagen doesn’t have a clear answer for who builds its cars, where, or under what tax rules, on any continent right now.
Volkswagen isn’t short on EV plans for India. It has had the same one since 2022. What it’s short on is the capital clarity, the corporate will, and increasingly the customs paperwork to actually execute it. Announcing a strategy once is vision. Repeating it for four straight years, while fighting a $1.4 billion bill over the last time it tried something similar, isn’t patience. It’s a company negotiating with itself, out loud, in public, for a decade running.
That’s the detail worth remembering here, not the EV penetration percentage. This was never a story about which electric Skoda or Volkswagen shows up in Mumbai first. It’s a story about whether Volkswagen can commit to anything in India before the market moves on without it.