Report: VW To Green-Light Budget Car for Emerging Markets

Volkswagen is now expected to approve its long-discussed budget car project, which is targeted at emerging markets such as Africa, India, and China. According to a report from Reuters, Volkswagen’s executive board will approve the project in a few weeks, while the supervisory board will give it the go-ahead by summertime.

VW will most likely sell its budget car for between $8300 and $11,000, and be manufactured in China. It looks like the project will actually move forward after it first emerged from the rumor mill in 2010. At that time VW recently acquired Suzuki, which was predicted to supply much of the cost-saving know-how to the car’s development, given Suzuki's existing small-car prowess in emerging markets.

As recently as the Geneva auto show in early March of this year, VW development chief Hans-Jakob Neusser revealed that VW was still struggling to meet the cost and quality goals to give the budget car the green-light for production. Now that those goals appear to have been reached, we can expect a stripped-down budget car to increase VW’s presence in the international small car market, perhaps to such an extent that the German automaker could achieve its goal of leading the world in car manufacturing by 2018.

VW’s smallest model in its current lineup is the VW Up! city car (pictured), which first debuted at Frankfurt in 2012. The Up! uses a range of three-cylinder engines that provide between 59 and 75 hp, all mated to a five-speed manual gearbox.

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