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Skoda to be an independent car brand in India

Arijit Roul / 10 Mar 2018

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Skoda is planning to go independent of the Volkswagen group in India. The company forms part of the Volkswagen group along with Audi. However the company plans to have its independent image in the country and market products as part of a dedicated Skoda portfolio alone. The Czech carmaker has been making modest sales in the country with the few premier vehicles that it offers. With the introduction of a new platform for designing and manufacturing vehicles at low cost, Skoda feels that the company can work independently in this country.

Bernhard Maier, Chief Executive of the company, stated that they would be developing cars for India based on the new platform which would be ready for launch by 2021. The MQB A0 design framework that Volkswagen has adopted for its group companies and their products would help to develop low cost vehicles. There had been initial talks with Tata Motors to work on car production based on this platform, but the agreement did not go through.

Volkswagen is now commissioning Skoda to work on this platform so that entry level cars can be developed. The company has realized that sales volume can be picked up only when the different segments are captured and in the entry level hatchback and other segments besides premier SUV and a sedan, the company is yet to create a presence.  The company is confident that, even without an Indian entity to collaborate with, they will be able to start production locally. The first step is to plan production of about 300,000 cars for the automobile market here every year.

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India is set to be the third largest in car markets by the year 2020. We would come into focus right after China and United States and hence, it makes sense that companies are changing strategies to strengthen their foothold in the country. Skoda would be planning to invest considerably in developing electrified models in the near future. The current status of the company shows that the car count is 1.2 million across 15 sites in different parts of the globe. As Skoda increases its presence, it would be looking to increase its car production by about 2 million by the next decade. Hence, its first step to increasing its brand presence is probably the step to go independent in India and establish its brand name through more products.

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