Skoda committed to India market, relooking at diesel for bigger vehicles

VW-owned brand to launch three cars in 2021

Skoda Auto India’s latest launch of the Rapid TSI (petrol), which is an automatic mid-size sedan with a petrol engine, reinforces the company's commitment towards growing its footprint in the country and is the extended part of the launch of three cars that were rolled out in May.

The Skoda Superb, Skoda Rapid, and Skoda Karoq were rolled out earlier as part of the company's Rs 8,000 crore investment in India which Zac Hollis, Skoda Auto’s director of sales and marketing, said remained unchanged despite the Covid pandemic.

The Czech-origin brand -- which is owned by the Volkswagen Group worldwide and runs under the newly formed company Skoda Auto Volkswagen India here -- is also on track to launch three more vehicles next year. These are the brand new Skoda Octavia, a mid-size SUV, and a mid-size sedan -- both of which will be heavily localised, Hollis said.

The mid-size sedan will replace the Rapid. “We are committed to India and confident of the car market for the future,” he said. The company is not planning to bring back diesel engines for smaller cars, where petrol is clearly the preferred choice, but it is relooking at diesel engines for bigger vehicles.
 

“Larger SUVs, which are heavier and play a stronger role in fuel efficiency, could potentially be brought in with diesel engines,” Hollis said. “Sales for Skoda have picked up in recent months with the Pune factory in full operation at maximum capacity.”

Sales for Skoda in April were zero but increased to over 1,000 units in August; September is on track to witness 1,200 unit sales, he said, adding, sales have been coming back to pre-Covid-19 levels.  Last year, Skoda had sold around 15,000 cars. 

While Skoda has had a strong run with its brand recognition in the subcontinent, at times even getting better known than its sister brand Volkswagen, which is ahead in global markets, the challenge to its scaling up could come from smaller tier-3 towns, where education will need to precede recognition among consumers. Hollis acknowledged that but said the company has 86 dealership and service locations across the country and this figure will grow to 100 by the end of this year, and to 136 next year. "Expanding the dealer and service network is the first step towards entering a new market; other steps then follow naturally," he said.

Suraj Ghosh -- principal analyst, powertrain forecasts, automotive, IHS -- says Skoda now looks like a revitalised brand and the flurry launches over the last few months makes its product line-up look good for the future. "It will have a model in every emerging segment, as well as higher-priced segments, and its India 2.0 vision seems to have remained unaffected by Covid which shows it still believes in the India growth story," he said.