Based on the successful VW Polo, Volkswagen Russia is introducing a new budget car designed specifically for the Russian market. It is going to be produced at the VW Kaluga factory and will retail at $12,500. The design will specifically focus on fitting the cars with a higher chassis to prevent damage due to the many potholes on the Russian roads.
With a 1.6 liter, 105 horsepower engine, this budget car will be the first and only in Russia with a 6 speed transmission. The price ensures that this new Volkswagen will be eligible for the government subsidized loans that are offered to customers purchasing a car for less than $19,200.
Another program that this new model will be eligible for is the “Cash for Clunkers” program where if you trade a car more than 10 years old, you will get a rebate. Volkswagen Russia expect to sell 10,000 cars this year and up to 30,000 next year.