Skoda Auto Volkswagen India has signed a non-binding Memorandum of Understanding (MoU) with the JSW Group to explore a strategic partnership in India.

In an official statement shared with a local daily, a Skoda Auto Volkswagen India spokesperson said the proposed partnership would be based on joint control, with defined roles and mechanisms for decision-making.

The two groups will explore a wider product portfolio, deeper localisation, and the expansion of manufacturing and research and development capabilities in India.

"Deep localisation and platform synergies are intended to support competitive product offerings, increased scale, and improved profitability in the Indian market," the spokesperson said.

A local daily reported on August 5th that the companies were in the final stages of negotiations and were likely to sign a non-binding MoU. A 51:49 joint venture, with JSW holding the majority stake, was among the structures under discussion at the time.

The official statement confirms that the arrangement will provide for joint control but does not disclose the proposed shareholding or investment. These details will be discussed during the next stage of negotiations before the two sides move towards definitive agreements and seek the required approvals.

EVs and localisation at the centre of talks

The partnership could support Skoda Auto Volkswagen India's next phase of investment in electric vehicles and localisation.

A local daily understands that potential investment from JSW could help fund the development and localisation of electric vehicles, along with future product programmes for the Skoda and Volkswagen brands.

A significant portion of the investment under discussion could be directed towards products based on the India Main Platform, Volkswagen Group's proposed electric vehicle architecture for the country. The platform is derived from the China Main Platform and would be adapted to Indian regulations, local sourcing requirements and the domestic supplier base.

The platform could underpin a range of electric SUVs for Skoda and Volkswagen. Higher local content would be required to reduce costs and improve the competitiveness of these vehicles in India.

The two sides have also been evaluating the use of manufacturing assets across the JSW Group. A local daily previously reported that greater localisation of products such as the Kodiaq was being examined at JSW Motors' Sambhaji Nagar plant.

The localisation of the next-generation Kodiaq platform is also under evaluation. If approved, it could support a locally manufactured three-row SUV positioned in the Mahindra XUV700 segment. The companies have not officially confirmed these product plans.

Exports are also likely to form part of the discussions. The alliance could use Volkswagen Group's overseas distribution network to develop India as a manufacturing base for domestic and international markets. A possible India-European Union free trade agreement could make exports to Europe more viable over the longer term.

India and Volkswagen Group

India is one of the markets included in Volkswagen Group's internationalisation strategy. With Skoda Auto leading the Group's operations in the region, the country is being developed as a base to serve neighbouring regions and other overseas markets.

Skoda Auto Volkswagen India recorded domestic volume growth of around 36% in 2025. Brand doubled its sales in India during the year, recording its highest year-on-year growth among its global markets.

"To fully explore the country's growth potential, we are always considering new business opportunities," the spokesperson said.