Renault's Dacia brand has shown through its success that consumers are willing to give up some creature comforts for solid, basic transportation. Soon, Nissan will follow a similar path with the launch of its Datsun brand in emerging markets. We've heard rumblings Volkswagen Group might follow the trend and go back to its roots with a second people's car, and the vehicle might be closer than ever.

Reuters says that VW Group's executive board is due to sign off on its entry-level car as soon as this week, and the company's supervisory board will lend its support by the summer. A VW spokesperson revealed that the new model was in development behind closed doors, despite the final production order not yet given. The vehicle is slated to cost 6,000-8,000 euros ($8,261-$11,015) and be built and sold in China starting in 2016. That brings the starting price about 4,000 euros ($5,500) below the already basic Up! (pictured above).

The key to this entry-level market is creating purpose-built cars for the needs of users, according to industry analyst Dave Sullivan of AutoPacific. "As we saw from the Tata Nano, taking everything out and making it super low cost won't get people to buy it," he told to Autoblog. The little Indian car was touted for its low cost but hasn't lived up to sales forecasts. According to an earlier report, Volkswagen was having trouble meeting its desired quality and safety standards for the budget vehicle, while maintaining profitability, which obviously compromises user need.

"There is actually a huge demand for affordable and reliable transportation," said Sullivan. He believes VW may face a challenge because by the time the new model is ready, it will face competition from Datsun and Chinese brands expanding into emerging markets. While VeeDub regularly dukes it out with General Motors over the title of the largest automaker in China, in the rest of Asia and India, the company has a relatively small market share, according to Reuters. The cheaper entry could give the brand a foothold there and help propel the Group to its goal of being the world's largest automaker by 2018.


I'm reporting this comment as:

Reported comments and users are reviewed by Autoblog staff 24 hours a day, seven days a week to determine whether they violate Community Guideline. Accounts are penalized for Community Guidelines violations and serious or repeated violations can lead to account termination.


    • 1 Second Ago
  • 40 Comments
      Hek!
      • 9 Months Ago
      I hope someday they figure out that being the best automaker is a better goal than being the biggest.
        A P
        • 9 Months Ago
        @Hek!
        VW does not have to worry about being the biggest.......that train has sailed for now........I love how they were so SURE (along with VWs paid bloggers that kept telling us) that they were going to be #1.
      thedriveatfive
      • 9 Months Ago
      People say no market in the USA for this but I think a 8000 VW with AC would sell here. There would be a huge teen market for affordable first cars. Probably move 40K of them a year at least. Then when they hit college they could upgrade to GTI's or the like.
        muchdrama
        • 9 Months Ago
        @thedriveatfive
        If VW chose to sell this thing in the US, and if it had A/C--I'd buy one in a heartbeat. I really would. Even with roll up windows and manual locks.
          jupiterzone
          • 9 Months Ago
          @muchdrama
          I'd buy one too...like the squares would say: "It's a no-brainer"...lol
        GR
        • 9 Months Ago
        @thedriveatfive
        I doubt it, guys. I know a guy in Australia who bought one of these VW Up!'s Less than a year later, he's trying to get out of it. He's kind of an idiot so I'm not surprised he bought this piece of crap in the first place. If a VW can cost 5000 less than a POS Up!, it can only be an automotive abomination.
          EricDJ
          • 9 Months Ago
          @GR
          You don't mention a single issue about the Up!, you just badmouth it. The car mentioned in this article isn't about speed, horsepower or even trim levels. It is about transportation for people who need an affordable car in an emerging market. These cars likely may not even pass rules in most other countries. It may be an automotive abomination to your country, but to a country where most people have not ever had the opportunity to own a car is different. Back to the Up!. It isn't a secret that the car is tiny, low powered, but it serves a purpose. It is fuel efficient, more affordable than other cars, cheaper on insurance for countries who charge by motor size etc, and can fit in tiny parking spaces in overcrowded cities. You state your friend is an idiot, but he likely expected more than he got. There is a reason my GTI costs more than my Rabbit/Golf did, and it is materials. I see friends who buy cars based on looks and not off of trying them, many are disappointed after a short time. Test drives being down proves that people just walk in and buy off of looks.
      William
      • 9 Months Ago
      It'll sell well when our economy crashes again.
      Cruising
      • 9 Months Ago
      A cheap car made in the present are really not that bad at all. The frugal aspect are their charm. They might not go super fast or be able to carve up a canyon but the cost of ownership is rather low. It would be amazing to plop down $8k for a brand NEW car! All the money you save you have no excuse to maintain it properly.
      Rocketman1945
      • 9 Months Ago
      $8000 is not cheap. $1000 would be cheap. Still more than I want to pay. Actually, I would prefer that cars were free.
      GR
      • 9 Months Ago
      "There is actually a huge demand for affordable and reliable transportation," In that case, avoid a VW product. Heck, the best name in this is Suzuki, especially in Asia.
      Willy
      • 9 Months Ago
      Oh the mystical cheap car everyone wants but no one buys.
        bootsnchaps60
        • 9 Months Ago
        @Willy
        The most recent "cheap" cars were the Aveo and the Accent, neither of which were cheap in price once AT and AC were added. I plan to look at a Mitsu Mirage. I think there's a market but go to a dealer and all that is available is higher content/cost models. Most shoppers want it NOW, and aren't willing to wait to order.
        Rob Gomes
        • 9 Months Ago
        @Willy
        This is made for emerging markets like India and China where low prices genuinely matter, not the US or Western Europe where people can afford little luxuries.
          Willy
          • 9 Months Ago
          @Rob Gomes
          There's another element that's forgotten, people don't want to lose face when everyone knows you own a cheap car. A nicer used car might be a better option in emerging markets. Although I personally want purchase a bare bones no frills cheap car. The antithesis of current ones
      thumerzs
      • 9 Months Ago
      Dunno 'bout the car, but VW has the color red down perfect. I wish all the other automakers would lose their orange-y hue and offer this shade instead. Oh, and 8 grand brand new? That' little ride would sell anywhere for that kind of money.
      Autoholics Anonymous
      • 9 Months Ago
      If that is the lowest VW thinks the price can go Elio Motors believes they can do better at $6,800 even with HVAC, power windows, lock, steering, stereo, tempered glass with defrost all standard. People seem to be interested too with nearly 13000 reservations so far.
        Doug Utz
        • 9 Months Ago
        @Autoholics Anonymous
        13,000 fools and their money are soon departed. If it sounds too good to be true, it most likely is.
        mcd
        • 9 Months Ago
        @Autoholics Anonymous
        Elio Motors is severely delusional. They don't even have a production facility, production equipment, production employees, or the capital needed for any of the above. Their future sales projections are also pure nonsense.
      Larry Jr
      • 9 Months Ago
      I think they should base a redesigned New Beetle on this chassis. This chassis' dimensions are closer to what the original Beetle was anyway. Let's reintroduce the New Beetle with the Polo and not necessarily introduce the Polo in the U.S. No, I don't expect this comment to amount to much for VWoA's product planners.
      mikemaj82
      • 9 Months Ago
      Just because it's cheap, why does that mean it has to look cheap? Can't they design a cheap car that actually looks somewhat decent?
      Driver
      • 9 Months Ago
      The problem in asia isn't the price of a new car its the price to park it. If someone can afford to upgrade from a scooter to a car in a typical Chinese city it means they can also afford to purchase a parking place near there apartment building and pay for expensive parking everywhere they go. It seems to me that VW is chasing a market that will create little profit as the gap between running a scooter and running a cheap car is still a lot wider then the gap between the cheapest car VW could make and something like the Up.
    • Load More Comments