Volkswagen has agreed the basic concept and design of a budget car for emerging markets, said Hans Demant, the VW executive in charge of the project.

VW has been trying for more than a year to hit internal cost goals for the model, which would likely sell for between €6,000  ($8,300) and €8,000 and be built in China, the biggest market for low-cost cars.

“The concept and design are now in place,” Demant said on the eve of the Beijing auto show. “We will produce all components in China.”

Demant’s comments are more upbeat than those of VW brand development chief Heinz-Jakob Neusser who said at last month’s Geneva auto show that it was becoming more difficult to hit cost goals for the budget car. Neusser said it made no sense to approve a vehicle that was not meeting in-house targets.

VW lacks a strong presence in markets such as India and southeast Asia which are dominated by no-frills models, and without a successful budget car, analysts have questioned whether the group will be able to meet its goal of becoming the world’s biggest carmaker by 2018.