Volkswagen India is all set to dive headlong into the fiercely competitive compact sedan with the Ameo which goes on sale later this month. The Polo-based sedan is VW’s first mass market model since the launch of the Vento in 2010 and will play a critical role in increasing sales for the German automaker, which have dropped by 22 percent in the last two years. 

However, the Ameo will be up against some formidable rivals and this made VW tweak its pricing strategy. Most VW products tend to be priced at a slight premium over their competition, and while that was thought to be the case with the Ameo too, sources from the company tell us that it will have a starting price well below Rs 5.4 lakh (ex-showroom, Delhi).

This means that, while it won’t worry the likes of the Tata Zest (starting at Rs 5.07 lakh) or the Ford Figo Aspire (starting at Rs 5.2 lakh), it will be priced bang on against the Maruti Dzire, Honda Amaze and Hyundai Xcent, all of which have starting prices between Rs 5.32-5.36 lakh. One thing, however, has to be borne in mind – we are talking only about the base model, and higher variants could have a bigger price discrepancy, depending on the equipment list.

And the equipment should play a role, as the Ameo promises some first-in-class features, such as cruise control, rain-sensing wipers, static cornering lights and a touchscreen with MirrorLink that is capable of replicating your phone’s screen. Higher variants will also get the likes of automatic climate control, a rear AC vent, rear parking camera, electronically adjustable rear-view mirrors and a cooled glovebox, which are fast becoming the norm in the class.

The Volkswagen Ameo is the company’s first car developed solely for the Indian market, hence its codename ICS (or Indian Compact Sedan). The car will be launched only with a petrol motor – the modest 74hp, 1.2-litre, three-cylinder motor as the Polo. However, VW will launch the diesel version later in the year with an updated version of its 1.5-litre TDI engine with as much as 112hp, which will be class-leading. It could also get the option of a high-tech seven-speed dual-clutch gearbox with this oil-burning motor, which would also give it an advantage over the other diesel automatics in the class – the Tata Zest and Maruti Dzire – which use more basic AMT gearboxes.

The Ameo may be a little late to the party, but Volkswagen wants to make sure it arrives with a bang. The longer equipment list and more powerful diesel engine should enhance its appeal, but price is a key factor in this class, and a competitive starting or ‘hook’ point will be critical for pulling buyers into showrooms. Because of VW’s reputation for premium pricing, some are already estimating a price much higher than it actually is, and just to drive the value point home, the company is even holding a ‘Guess the Price’ competition on its Facebook page to help change customer perception. Volkswagen will reveal the price of the Ameo on June 5, 2016. 

More on the Volkswagen Ameo

VW Ameo variants explained
VW Ameo first look
VW Ameo to come only in petrol initially
VW Ameo: 5 things to know
VW Ameo photo gallery