VW targets India, Russia; 2008 pretax profit to hit $6.92 billion

Winterkorn said the company, which is establishing production in India and Russia, is "working hard there to build a sound position" in both markets.

"India is one of the fastest growing automotive markets worldwide. We are intent on playing a key role in shaping this growth," he said, noting that Volkswagen sells Audis in the country and that some models from its Skoda unit are already built there.

"We will also soon be more heavily involved in the Indian market with the Volkswagen brand. Because of the high tariffs on imported vehicles, however, we will only be able to build a satisfactory presence in India if we also manufacture there directly," Winterkorn said.

He said that is why VW will build a plant near the city of Pune at which it will start producing models including a small car "tailored to the needs of our customers in the Indian market, beginning in 2009."

Volkswagen expects to start assembling Volkswagen and Skoda models at its new plant in Kaluga near Moscow by the second half of this year, but is aiming to eventually have a complete manufacturing presence.

"As in India, our objective in Russia is a full manufacturing process. Once the body shop, paint shop and assembly line are ready, we will be able to start manufacturing Volkswagen and Skoda models in Russia in 2009," he said.