November 27, 2020

Skoda: Backed by new SUVs and sedans, Skoda Auto Volkswagen India eyes trebling output in 2 years



Mumbai: Skoda Auto Volkswagen India Pvt Ltd is planning to treble output to 200,000 items within the subsequent two years, on the again of latest product launches, with the carmaker utilising the Covid-19 pandemic-induced lockdown to revamp its manufacturing unit beneath its India 2.zero mission.

The Indian arm of Volkswagen Group – the world’s largest carmaker — can be open to partnerships within the nation and can proceed to speak to events in future, its India chief advised ET, a transfer that can assist construct scale and scale back break-even factors.

The carmaker is bullish on the way forward for the Indian market, together with its exports potential, and can roll out sedans and sport utility autos between 2021 and 2022, mentioned Gurpratap Boparai, managing director of Skoda Auto Volkswagen India.

Boparai mentioned the corporate expects to function the plant at 100% capability inside two years and the group garnering 3% share of the Indian market.

“We can be within the part of ramping up manufacturing from subsequent 12 months. One after the other, new fashions can be launched each six months until 2022 beneath the India 2.zero plan. The following 12 months can be positively higher than this 12 months, however we’ll actually see our full volumes in 2022. That is once we count on our group market share to be round 3%,” he added.

With capability more likely to be absolutely utilised subsequent 12 months, Skoda VW will discover its subsequent part of growth within the nation, Boparai mentioned, however when and the way quickly will rely on market restoration.

“If we do a partnership, we’d clearly be increasing capability after which that capability could be shared. There’s nothing concrete in the meanwhile (on partnership). We proceed to interact with all gamers which have related methods,” he added.

The corporate has reportedly been in talks with MG Motor India for a contract manufacturing tie-up.

Boparai, nevertheless, declined to touch upon potential companions it’s in discussions with.

For years, 60-70% of Skoda VW’s complete manufacturing was reserved for exports, however Boparai mentioned that’s set to reverse from 2021.

“We’re very bullish about restoration within the Indian market, so we’ll proceed to provide as a lot because the Indian market absorbs after which no matter is required to utterly utilise our manufacturing capability that we’ll export. The restoration within the exports market is relatively gradual, as in opposition to a V-shaped restoration now we have seen right here,” he mentioned.

VW Group has up to now exported half 1,000,000 vehicles from India, the corporate mentioned on Tuesday.

Whereas the home market will take priority over exports, the group is more likely to begin exporting Skoda-badged autos beginning subsequent 12 months, increasing its world footprint for India-made vehicles to over 100 markets.

Backing the federal government’s Make in India push, Boparai mentioned the nation can acquire a aggressive edge on larger automotive exports too by eradicating the sub-Four metre definition.

India is among the most cost-efficient manufacturing bases for car firms, however the tax construction prefers vehicles lower than Four metres in size and that’s taking away its aggressive edge, Boparai mentioned.

“The worldwide market of sub-4-metre vehicles is roughly 7% of the pie. And that’s clearly not too massive,” he mentioned.

“We perceive that it’s going to take time to transition to any new taxation regime, however there must be some roadmap on when the cess on the 2 classes of vehicles will come right down to the identical quantity. That might actually open up our business to the segments the place there’s much more export potential globally,” Boparai mentioned.