The Czech Attack!
Skoda Auto is all set to revive its operation in the Indian market and has a plan to invest Rs.8,000 crore in the Indian sub-continent. ‘India 2.0’ is the term used internally for the Revival plan! The VW subsidiary will utilize the investment to launch high volume models (particularly small & mid-sized cars) using the MQB platform. It shall also come up with a new Engine plant using the investment. It will also spawn Skoda-specific models and shall refrain from ‘badge-engineered’ products (like the Skoda Rapid & VW Vento). Skoda Auto shall have its own models and will carry no resemblance with the products in its sibling VW’s portfolio.
Skoda entered the Indian market way back in 1999 and has been trying to get a considerable pie in the sub-continent. Though it initially established itself as a premium brand and launched the likes of Octavia & Superb (which were adored by the consumers) – poor service quality & customer experience proved detrimental to the brand. The tank like body and eye-pleasing European design were the USPs of the offerings from Skoda – However, inconsistent product quality & high cost of ownership made it difficult to earn volumes over the years.
A brief on the History of Skoda Brand –
Skoda as a brand is over 150 years old! Skoda was founded way back in the year 1859 by Waldstein family that used to be the royal family of erstwhile Austrian empire. Emil Ritter von Skoda a Czech Engineer bought the factory from Waldstein family in1969 after working nearly for three years with the company.It used to be the machine factory.In 1869. In 1886 he provided railway facility to the company and in the year 1890 he added an arms factory to the company. The arms factory produced machine guns for the Austro Hungarian army.In 1899 he incorporated his holdings as the Skoda Works which produced locomotives,aircraft,ships,machine tools,steam turbines and power utilities.In 1895 Vaclav Laurin and Vaclav Klement founded the company Laurin and Klement. The company first started making bicycles and then moved to motorcycles.The first motorcycle skoda created was called the motorcyclette and was powered by an engine mounted on the handlebars. It did ,however,prove extremely dangerous and was shelved.
The origins of what became Škoda Auto go back to the early 1890s when, like many long-established car manufacturers, a company started manufacturing bicycles. Škoda (then Laurin & Klement) factories were founded in 1896 as a velocipede manufacturer. By 1905 they started manufacturing cars ,making it the second oldest car manufacturer in Czech lands after Tatra. The first model was the Voiturette A which was an instant hit.
Skoda under Volkswagen
The split of Czechoslovakia due to communism led to many changes in the automotive industry. Most of the industries were now open to privatization and Skoda was part of it.A joint venture was made in 1991 between Volkswagen and Skoda and Volkswagen took 30 % share in it. In 1995 the share was raised upto 70%. Skoda engineering improved greatly by Volkswagen inputs.
The present day Skoda
Skoda has gone from strength to strength. From a small player to a highly regarded brand, Skoda consistently stays at the top when it comes to customer satisfaction surveys globally. Skoda recently revealed the concept of their electric lineup like Vision X concept in Geneva motor show. They are also going to release the plug in version of present lineup. Initially the company was meant to serve the role of VW Group’s entry brand. Over time, however, the Škoda brand has progressed upmarket, with most models overlapping with their Volkswagen counterparts on price and features, while eclipsing them on space.
Skoda Auto in India –
Sales Trend of Skoda India
Skoda India sales has been operational since November 2001 and has been able to sell over 2.5 Lakh units in past 17 years!
Just to highlight the sales volume – Skoda in its entire term in India would have sold less than what Maruti Suzuki would have sold in same market in 2 months!
Skoda India saw the highest rise in sales post the launch of its sedan – ‘Rapid’. The highest volume was recorded in the month of June 2012, where Skoda reported a sale of 4,923 units (in which Rapid sales was 3,246 units).
Even as on date, Rapid’s contribution to Skoda’s sales is phenomenal – Rapid contributed ~70% of Skoda’s volumes in the year 2017!
To increase sales in India, Skoda may bring back the Fabia hatch! Owing to poor sales and high assembly cost, Fabia had been discontinued in 2014.
In the fresh lineup from Skoda, expect a mid-size SUV to be launched which shall be pitched against the likes of Hyundai Creta! The Design cues shall be taken from the Vison X concept –
Will Skoda’s efforts help it revive the ailing sales volume? Shall ‘India 2.0’ be effective for the Czech major? We expect Skoda to strengthen its dealer network in terms of providing a standardized customer experience and also bring much more reliable cars in the future. There is a lot of brand repair that needs to be initiated prior to running behind the volumes. Hope the OEM takes the right steps and march past the expected market share.
(This article is written by Gourav Saksham, a dentist by profession and a Petrohead by passion. You can connect with him at firstname.lastname@example.org)