Volkswagen Announces Name of New Sub-4-Meter SUV Based on Skoda Kylaq – Meet the new Volkswagen Tera
Volkswagen has officially revealed the name of its upcoming sub-4-meter SUV, set to be based on the Skoda Kylaq platform. The new compact SUV will be called the Volkswagen Tera and is expected to launch in 2025 in Brazil first and then in India. Designed to compete in the rapidly growing sub-4-meter SUV segment, the Tera will join Volkswagen’s portfolio as a stylish, compact option that combines modern design, premium features, and the brand’s legacy of quality.
Built on the Skoda Kylaq Platform
The Volkswagen Tera will share its platform, powertrain, and core engineering with the Skoda Kylaq, which is all set to make its global debut today. However, the Tera will feature a unique design in line with Volkswagen’s distinctive styling, including a new grille, lighting elements, bumpers, and a redesigned tailgate. Similar to other Skoda-Volkswagen collaborations like the Kushaq/Taigun and Slavia/Virtus, the Tera will bring Volkswagen’s flair to a tried-and-tested platform.
Under the hood, the Volkswagen Tera is expected to be powered by the same 1.0-liter turbo petrol engine used in the Skoda Kylaq. This engine produces 115 hp, making it a solid choice for both city commuting and highway cruising. As with the Kylaq, this engine will be the sole offering in the Tera lineup.
The Tera is likely to include premium features such as advanced connectivity options, safety tech, and a spacious interior, reflecting Volkswagen’s focus on quality and user experience. The SUV will also be equipped with Volkswagen’s latest infotainment system and could potentially offer top-end features like connected car technology, customizable driving modes, and a premium audio system.
Positioning and Market Timing
Volkswagen’s decision to enter the sub-4-meter SUV segment was influenced by changing market dynamics, including a slowdown in EV sales and continued growth in the compact SUV space. Initially, the company had planned to focus on electric vehicles in India by 2028. However, with shifting priorities and a growing preference for compact SUVs, Volkswagen has adjusted its strategy to include ICE models like the Tera in its lineup.
Although the Tera’s launch might appear late in a segment crowded with options, the sub-4-meter SUV category remains one of the fastest-growing markets. Volkswagen’s entry into this space aligns with the company’s “India 2.5” project, a Rs 2,276 crore initiative aimed at increasing plant utilization and achieving economies of scale.
Volkswagen’s Shift in Strategy
Volkswagen’s entry into the sub-4-meter SUV segment marks a significant shift in its strategy for the Indian market. After earlier setbacks with models like the Ameo, Volkswagen was cautious about entering the compact space. However, with the success of the Skoda Kylaq platform and increased demand for compact SUVs, Volkswagen has seen an opportunity to re-enter this segment with a fresh approach.
