Czechoslovakian auto major Skoda, a subsidiary of Volkswagen, has decided to price the Octavia diesel version in India at around Rs 11 lakh, making it the lowest priced car in the B-segment.
A 2-litre petrol version will follow Octavia's 1.9-litre turbo-charged diesel engine version, and is expected to be priced slightly lower.
The Octavia will be priced around 20 per cent lower than offerings from Honda (Accord) and Hyundai (Sonata).
Also Read
The D-segment (between Rs 10-25 lakh) will soon see more competition from the Ford Mondeo, and will also compete against top-end C segment cars -- Mitsubishi Lancer, Honda City and Maruti Baleno.
Initially, the Octavia will be imported in the form of semi-knocked down (SKD) kits, which will be assembled at Skoda Auto India's assembly plant at Aurangabad, Maharashtra.
However, top company officials hope to manufacture the car locally in future.
Imran Hassen, director (Indian operations) of Skoda said, "We want to develop India into a regional hub for exports to other far-east Asian countries, once we start producing the car locally."
Skoda has set itself a sales target of 5,000 cars for the year 2002, which, according to Hassen, is a "very ambitious target for a newcomer."
It is planning to set up 14 dealerships by next year, almost all of which will be set up in major markets (read big cities).
Initially, there will be no local content in the Octavia. "We would like to produce it in India later, after deciding on suppliers, training dealers and setting in place quality standards," Hassen explained.
The company is, however, adopting a very cautious approach towards making investments in India.
"We have to make a conscious start so that we do not run into red figures. We do not want to make a big boom running in and endanger the future (subsequently)," Hassen said.
Skoda is a very profitable subsidiary of Volkswagon, the largest car maker in Europe, with a presence in over 70 countries.