The key for manufacturers is to introduce vehicles across segments, while depending heavily on 1-2 cars in specific segments. Growth through just a single car is always a limited strategy. Sales volume goals are just as limited if you don’t have enough cars to show for it. Skoda’s strategy for India is goal oriented to the end that the Czech automaker is aligning itself as a premium vehicle brand here. Back in February, during Skoda Superb facelift launch, Sudhir Rao, Chairman and MD, Skoda Auto India spoke regarding company focus having shifted to sustainable profit over sales volume growth.
At Delhi Auto Expo this February, the automaker showcased Skoda Superb facelift just before launch and Yeti facelift, yet to be launched here. Back in May 2013, it was first revealed that Skoda was discontinuing production of Fabia. What has started out for Skoda as a profitable small car in India, had over the years turned into a loss-making line of business.
At present, its vehicles on offer include Skoda Octavia (D1), Skoda Superb (D2) and Skoda Rapid (C2) segment. Clearly, Skoda’s premium appeal is a sedan story. Yeti, which is also on offer hasn’t offered much in terms of sales volume through 2014.
As Skoda isn’t stressing on number of cars sold, and has directed its effort to strengthen segment wise market share, and its sales report is open to interpretation. What clearly looks like a stark decrease is market share is actually giving the automaker time to improve its market positioning. The luxury market clearly entails higher price tags, and Skoda continues to make headway despite an overall slow Indian auto market.
This May, Skoda sold 900 vehicles as compared to 1800 cars sold in 2013, equating to 50% sales decline. In April 2014, Skoda India sold 1200 cars. When compared to 2000 cars sold in April 2013, it equated to 40% sales decline.
The story was no different for Q1 2014. Through January, February and March sales stood at 1600, 1300, and 1700 units respectively. When compared to Q1 2013 sales of 2400, 1800, and 2300 units for the corresponding months, sales decline was reported at 32.5%, 28.2%, and 26% respectively. For the year thus far, Skoda India sales stand at 6700 units. When compared to January-May 2013 sales of 10300 units, it equates to 35% sales decline.