The German giant has staked its future, to the tune of 80 billion euros ($91 billion), on being able to profitably mass-produce electric vehicles - a feat no carmaker has come close to achieving.
Renault SA, Nissan Motor Co Ltd and Mitsubishi Motors Corp together sold 10.76 million passenger cars and light commercial vehicles in 2018.
Volkswagen (VW) said on Friday it would invest 870 million euros ($985 million) by 2020 to developing e-vehicle components, adding the batteries business would manufacture battery cells and packs as well as overseeing recycling of old cells.
Senior advocate Abhishek Manu Singhvi, appearing for Volkswagen, said that the company has been singled out for violation of norms which are "non-existent".
Volkswagen said in December it may have to step up plans for mass production of electric vehicles to meet the EU targets.
Uttaresh Venkateshwaran gets in conversation with Moneycontrol's Stanford Masters to discuss the implication of the fine and Volkswagen's stance on the issue,
India's pollution court on January 17 asked the car maker to deposit 1 billion rupees by January 18 failing which could cause punitive actions including the arrest of its country head and the seizure of its properties, local television channels said.
A bench headed by NGT chairperson Adarsh Kumar Goel took strong exception to the non-compliance of its order by the automobile giant and asked it to give an undertaking that it will submit the amount by 5 PM January 18.
The company insisted that its vehicles were compliant with Indian emission norms and claimed that "the committee appointed by the NGT has accepted that Volkswagen Group India has not violated the permissible limits under BS-IV norms".
The announcement came after more than six months of talks between the car giants which has also included discussions around autonomous and electrification technologies.
The expert committee in its report has estimated that Volkswagen cars released approximately 48.678 tonnes of NOx in 2016 in the national capital.
The Germany's Federal Motor Transport Authority (KBA) has opened an investigation into whether a software update for 1.2-litre engine cars, including the popular Polo, enabled them to cheat emissions tests.
"2018 was marked by significant uncertainty in some regions, especially in the second half," VW brand sales chief Juergen Stackmann said in a statement but he added that new products had helped offset that.
Ford and Volkswagen have been exploring closer cooperation as trade frictions force carmakers to rethink where they build vehicles for Europe, the United States and China, and as software companies prepare to launch their own self-driving cars.
VW admitted in 2015 to manipulating 11 million diesel vehicles to appear less polluting under test conditions than in real driving.
The German automaker, still grappling with a diesel emissions scandal that erupted in 2015, said Wednesday the new system is based on one already used for the management board.
The deal, which still has to be approved by cartel authorities, would make VW a 75-percent shareholder in WirelessCar, the company said on Wednesday, without disclosing financial details.
Sales head Christian Dahlheim said on December 14 that "we are confident" 2018 will end with a figure slightly above the previous record from 2017, when the company sold 10.74 million vehicles.
Car safety watchdog, Global NCAP conducted crash safety tests on Indian cars and these vehicles passed the inspection in flying colours.
The company currently sells a range of vehicles starting from hatchback Polo to premium sedan Passat with prices ranging from Rs 5.55 lakh to Rs 32.99 lakh.
The German car giant has announced that its core brand will develop its final generation of vehicles using combustion engine technology in 2026.
Volkswagen will not develop any new petrol or diesel (fossil fuels) engine models after 2026
The move underscores just how serious the automaker is about closing the gap with Asian competitors and US tech giant Tesla who have had a head start in the e-car race.
VW CEO Herbert Diess said the company was also "considering building a second car plant" in the United States, adding, "We are in quite advanced negotiations and dialog with Ford Corporation to really build up a global automotive alliance, which also would strengthen the American automotive industry."
Overall, the company's total projected expenditure for the next five years amounts to 40 billion euros, the company said in a statement. It also plans restructuring measures that will generate 1 billion in earnings uplift already in 2018.