Volkswagen to make Jetta model in India

Volkswagen AG, Europe's largest carmaker, will start making its Jetta model next year at a new factory in India as it seeks to get a foothold in Asia's fourth-biggest automotive market.

The company, which will introduce the Passat in India this year, also plans to start selling its Beetle model in the country to tap demand for small cars, said Tobias Busch, president of Volkswagen's local unit.

Volkswagen is expanding into emerging markets such as India and China, where sales are growing with economic expansion and rising disposable incomes.

Nissan Motor, Suzuki Motor and other automakers are spending more than $5 billion to build factories or expand units in India, where the market is set to triple to 3 million vehicles by 2015, according to the Society of Indian Automobile Manufacturers.

"India is one of the few automotive markets with strong growth," Busch said. "The Jetta will enable us to employ the first workers and start building up our production system before we get into full-scale production in 2009."

Wolfsburg, Germany-based Volkswagen will start making the Passat later this year. The Passat will be assembled at the Indian facility of Volkswagen's Skoda Auto AS unit in Aurangabad in the western state of Maharashtra, Busch said. The Jetta was China's top car model by sales in 2006, according to the China Association of Automobile Manufacturers.

Volkswagen is building the new factory at Chakan near Pune in Maharashtra state with an investment of ¤410 million.