Skoda Auto will cover its dealerships’ fixed costs for the April-June quarter
COVID-19 has spread its impact beyond human health and affected several business operations worldwide, including the automotive industry. Coming to India, major OEMs have shut down their plants (or are working with extremely limited resources) to join the country’s fight against the pandemic. On the other hand, many automotive dealers are on the verge of going out of business forever due to the lockdown protocol.
A few brands have stepped forward to support its struggling dealership and supplier partners. Now, Skoda Auto (part of Skoda Auto Volkswagen India group) has announced that it will provide financial support to its dealers. The Czech-origin automaker will cover their fixed cost for the April-June quarter. This includes salaries and other essential payments of dealership staff and support systems of 80 official Skoda Auto outlets across India. The total expenditure for this is estimated to be around Rs 50-60 crore.
Skoda Auto Volkswagen India has been busy preparing its India 2.0 strategy under which a range of India-focused products (mostly SUVs or crossovers) would be introduced in the coming years. Every product would have a respective Skoda and Volkswagen equivalent.
At Auto Expo 2020, Skoda Auto had showcased the Vision IN crossover concept, the production version of which would be the first product to come under India 2.0 project. Reports state that it will be powered by a 1.5-litre BS6-compliant TSi petrol motor good for 148bhp and 250Nm of torque. The drive is sent to the front axle via a 7-speed DSG (DCT) unit.
The success of any new product depends on dealership performance. Zac Hollis, Director of Sales, Service & Marketing, stated that Skoda is committed to providing full support to its dealers for a period of three months, besides covering immediate cash flow requirements. He added that its partners’ health and safety are crucial for future growth. Keeping this in mind, Skoda Auto is planning to resume operations in a phased manner — dealer-to-dealer and region-to-region — depending on the lockdown’s withdrawal.
As per data, India’s automotive industry is facing losses in the range of a thousand crores daily. To aid the health department, quite a few OEMs have temporarily shifted its focus to making essential medical equipment. MG Motor India even introduced the ‘Affordable Ventilator Challenge’ among automakers. In addition to this, many names in the industry have donated wholeheartedly to various state- or central-government COVID-19 relief funds.