Interestingly as we spotted a 5-door Volkswagen UP! in Pune yesterday, this news pours in. After Tata Motors and Maruti Suzuki, it’s the German Auto Giant Volkswagen who are thinking of introducing a compact sedan, not only to take advantage of lower tax rate but also to take on the success of Swift DZire.
Economic Times reports that at least three people familiar with the developments told, the sub-4-Metre sedan will be developed on the Up! platform and will be powered by a 1.5-Litre Diesel Engine, a downscaled version of the existing 1.6-litre Engine that powers the Vento. This new car would, hence, sit below the current Vento.
Volkswagen India’s President Mr. John Chacko, however, refused to comment on this issue and that leaves us with no confirmation from the company. Among other car makers, Mahindra and Honda are also considering compact Verito and Brio Sedan respectively; and these cars are believed to be on the anvil. The fact is, during April – June of this year, the compact sedan segment grew by over 30 per cent. So, it’s no wonder that car makers are getting lured in this segment and want to share a pie.
Currently, according to our Excise duty structure, all cars lesser than 4 meters in length with a lower displacement than 1500cc for diesel (1200cc for Petrol) attract the least 12 percent excise. Medium and larger cars have different and higher slots. (Click here to know about our Excise Duty structure explained in simple terms with examples)
News Source: Economic times