German auto giant Volkswagen is planning to double its distribution network in India and increase brand spend before its much awaited entry into the country's small car segment early next year, a top official said here Friday.

"Gearing up to the launch of our high volume model Polo, we are expanding our distribution network. By the end of this year the company will have 40 dealers," Neeraj Garg, director (passenger cars) of Volkswagen Group India, told reporters here after inaugurating a new dealership.

The company now has 22 dealership outlets in the country, of which two are in Chennai.

Depending on the market, company would further increase the number of dealers, Garg said.

Volkswagen will roll out hatchback and sedan versions of Polo next year from its Rs.3,800-crore plant in Pune.

"This year the B-plus segment will be around 300,000 units in size. The entry of new players will further expand the market," Garg said.

He added that the company would step up spending on brand promotion activities in the country to meet the mounting competition challenges.

"It is true the Volkswagen brand is not well known in the country. This will be corrected with appropriate branding strategy."

Volkswagen will bring its popular model "Beetle" to India as completely built unit.

For the current year, Volkswagen hopes to sell 3,000 units of "Jetta" and "Passat", up from 1,566 units sold in 2008.

"We sold 1,900 units during Jan-Aug this year," Garg said.

While Volkswagen has no major plans to localise the components for these two premium cars, the company will go in for 80 percent local content for its Polo model, Norbert Hoppel, deputy general manager (parts organisation), told IANS.