India plays a key role in Škoda's export strategy

Published: 11.04.2024 Related countries:  India India

As the European automotive group Skoda Auto Volkswagen India (SAVW), which operates five major automobile brands in the country—Skoda, Volkswagen, Audi, Lamborghini, and Porsche—looks into tapping India as a major source of and enabler for exports into other South-east Asian economies, India will play a significant role in Czech automaker Skoda Auto's ambition for this expansion, a top company official said.

From a new logistics hub in Pune, Skoda Auto will provide completely knocked down (CKD) kits to Vietnam for local assembly of automobiles like Kushaq and Slavia. According to Piyush Arora, managing director and chief executive officer of SAVW India Ltd., the company already sells 30 % of its total production abroad. Of the approximately 150,000 cars produced locally in 2023, more than 42,000 were exported.

Furthermore, Ashish Gupta, Brand Director, Volkswagen India, believes that India could serve as a source market for exports into regions that are "behind" in their electrification journey.

Cars from India are becoming quite popular, and we are seeing a lot of demand from countries like South America and Africa. Many of our neighbours, including Bhutan, Bangladesh, and Sri Lanka, are interested in importing our automobiles, according to Gupta.

At the moment around15% of the car industry's total output is currently exported from India. The government expects the industry to increase its share to 25% globally by 2030. We (the Skoda group) are already at 30% plus, and we are not slowing down," Arora stated. The business is now planning to expand into new markets with the support of the legacy of parent Volkswagen's Vento and Polo as well as new automobiles like the Virtus and Taigun.

"Since we began exporting these models last year, we have seen a substantial 30% growth in our exports," Arora stated. "We are working to expand into new export markets. India is a crucial pillar that Skoda will use to promote its internationalisation ambition."

Since developing the India 2.0 strategy in 2018, Skoda Auto has been in charge of the SAVW group's brands and operations in India. This year, the company plans to introduce the Enyaq EV (electric car). Due to low car numbers, Arora stated that the EV will be imported into the India and assembled due to the fact that localising the manufacturing would not be financially feasible.

The Volkswagen brand, according to Gupta, will try to find a balance in India between entering a large segment like SUVs, where the group's brands are smaller players, and becoming the leader of a niche segment (VW's Virtus and Skoda's Slavia account for nearly 50% of the compact sedan segment).

Regarding the organization's broader intentions to transition to clean mobility technologies in India, Arora said that the SAVW group will be in line with the global goal of the Volkswagen Group to become an all-electric brand.


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