Volkswagen is developing a compact SUV based on the Skoda Kylaq to re-enter India’s competitive sub-4 metre segment, with a market launch expected in 2026, offering a potentially cost-effective alternative to key rivals.
Volkswagen is preparing a compact SUV for India that will be based on the Skoda Kylaq, according to Autocar India. The model is expected to mark the German brand’s return to the sub-4 metre segment, where it has been absent since the Polo and Ameo were discontinued. Industry sources cited by Autocar say the programme has received global approval and carries a development budget of about €25 million.
The new SUV is expected to share the MQB-A0-IN platform and 1.0-litre TSI petrol engine with the Kylaq, although Volkswagen is likely to give it distinct exterior styling to match its own design language. Reports indicate that manual and automatic transmissions are under consideration, with the automatic expected to be an 8-speed unit. If Volkswagen keeps the package competitively priced, the model would sit below the Taigun and Virtus and give the company a more direct entry point into one of India’s busiest vehicle categories.
That timing may prove important. Skoda’s Kylaq has already become a significant product for the group, with more than 50,000 units produced in just over a year, according to reports from CarDekho and NDTV. The SUV is built at Skoda’s Chakan plant near Pune and has helped support strong growth for the group in India, underlining the commercial logic behind a Volkswagen derivative.
Skoda’s own launch material described the Kylaq as its first sub-4 metre SUV in India and placed it in a market segment that accounts for nearly half of all passenger car sales. That backdrop helps explain why Volkswagen appears to be moving now. If the new SUV reaches showrooms in 2026 as expected, it will enter a crowded field led by models such as the Maruti Suzuki Brezza and Tata Nexon, with pricing likely to be a decisive factor.
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