With parent firm Volkswagen looking to become the world’s largest car maker by 2018, Czech auto major Skoda has set a target of doubling its sales by that time to atleast 1.5 million units. The firm plans to expand its product portfolio beyond the current 5 cars to include a small car later this year that may not come to India yet, and an entry-level sedan made exclusively for India.
Volkswagen and Skoda both had a record year in 2010 in terms of sales and revenue with the former, the world’s third-largest in the business, closing in on the top two, Toyota and General Motors. The VW group that includes Skoda, Audi, Bugatti, Seat, Lamborghini and Bentley, sold 7.3 million cars in 2010, a 15.4% growth over 2009 against Toyota’s 8.4 million and General Motors’ 8.4 million. Of this Skoda accounted for 762,600 units, its highest ever in a single year.
“Right now, we are standing at the beginning of a huge mobility boom all over the world wherein I believe the global market for cars may exceed 100 million by 2018,” said Martin Winterkorn, chairman, board of management, VW Group. “We have already stated our target to become number 1 in the world by that time.”
Besides Czech and Slovakia, Skoda manufactures cars only in five other countries including India, China, Russia, Kazakhstan and Ukraine.
“Last year was a historic year for us and we have started this year very well too,” said Winfried Vahland, chairman, board of directors, Skoda Auto. “We are now going to start a new model range that will help us switch to a higher gear.”
With the developed markets like US and Europe no longer offering much room for growth, Skoda has seen its sales grow fastest in Asia at 48%. In India, it sold over 20,000 units last year, a growth of 38% but it amounted to only a tenth of its sales in China where it sold over 200,000 units during the year. But the new sedan that will compensate for the absence of Octavia (phased out in 13 cities last year) and the car smaller and cheaper than the Fabia that is currently being developed, could well be the game changers.
“China is a big market, the biggest in the world, but India is more competitive,” said Thomas Kuehl, member of board (sales and marketing), Skoda India. “The market here is very price sensitive and
the options for a customer is going up by the day. If I can sell a car in India today, I can sell it anywhere else in the world,” he said.
(The writer’s travel and stay were sponsored by Skoda.)