John Chacko, Volkswagen Group Chief Representative for India, said the investment would go towards minor model changes and upgradation of the two factories.
The funds will also benefit Skoda and Audi’s domestic operations.
The German automaker has a 1.3-lakh annual production capacity at Chakan, where it makes the Polo, Vento and Skoda’s Fabia and Rapid models.
The Aurangabad facility has a 6,000-unit annual capacity and makes the premium models.
Engine Plant
Chacko said a final call on a Group engine plant in India would be taken in a few months, a move that would significantly reduce product costs as imported engines were expensive.
“We will decide by end of the year. If we go ahead with the engine plant, production should start by 2014,” he said.
Volkswagen had recently said it had put Rs 2,000 crore expansion plan on hold due to lack of clarity on the Maharashtra Government’s rollback of tax incentives.
It had said this could prompt it to invest in other States.
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