It seems the highly successful Renault-Nissan Alliance has led to more partnerships between carmakers. Volkswagen and TATA Motors have reportedly inked a longtime partnership deal on Wednesday. The two companies have allegedly signed a Mou or Memorandum of Understanding towards the development of new technologies, products and platforms. According to Autocar India, it has been more than a year since the manufacturers have been talking about the agreement.
The German automaker has been eyeing the Indian manufacturer as potential partner in exploring new markets. Being the largest vehicle firm in India, Tata Motors is also looking to increase its sales margin within or outside its market range. Nevertheless, this new partnership will help Tata come out with more vehicle lineups by 2019. It should be noted though that Jaguar, Land Rover and TAMO (TATA’s sub-brands) are not part of the alliance.
TATA’s latest AMP (or Advanced Modular Platform) is probably the most feasible architecture for the new collaboration. After the AMP received the EDAG approval, Volkswagen has found a more affordable alternative to its existing MQB-A platform. The AMP offers flexible architecture as well as definite cost advantage. At the very least, this will allow them to produce more extensive model range.
With Volkswagen group’s TOGETHER –Strategy 2025, the German car manufacturer plans to provide its brands with new responsibilities in both regions. TATA on the other hand has been consolidating its platforms from nine to six down to just two modular platforms.
However, it is still too early to speculate whether the Volkswagen-TATA partnership will be sharing one singular platform after the two inked up a deal. Whatever the case may be, this new collaboration gives Volkswagen the benefits of shared components and aggregates to save on cost.
Also, the teamwork will not be limited to India alone, wherein, the co-developed products can be exported to other markets as well. Since Volkswagen has earned its reputation when it comes to higher efficient smaller displacement engines, TATA can take advantage of this particularly in enhancing its products in the near future.
It’s been over 10 years since Volkswagen Group came to India but the German marque has yet to deliver an impressive sales figure. With its new alliance with the biggest Indian automotive company, Volkswagen can now look forward to a more cost-effective production of their vehicles without compromising their standards.
Matthias Müller, Volkswagen AG’s chief executive, said the company aims to “achieve sustainable and profitable growth” in all parts of the globe. Guenter Butschek, TATA’s Chief exec and managing director on the other hand believes that through this new partnership, both the companies can take advantage of each other’s strong points in order to develop smart solutions both for the overseas and Indian markets.