Skoda to Arrive in Australia

By: Benjamin Hudson

Skoda leading automaker in Czech Republic and a subsidiary of Volkswagen maker of the unparalleled has announced recently that it will return to Australia in October. It can be recalled that Skoda used to be treated as a big joke in the automotive world but with the disciplined that it gets from its German parent company; Skoda has been able to obtain Teutonic know-how, engineering and quality standards which has helped it to become the automaker it is today.

Skoda vehicles are to be distributed by Volkswagen Group Australia after its debut at the Sydney Motor Show. The lineup for Australia will include mid-size front-wheel-drive Octavia sedan and wagon plus the funky-looking five-door-wagon-cum-people mover called the Roomster. Both of these models were built at a modern plant at Mlada Boleslav near Prague.

To lead the range is a high-performance 147 kW, 2 liter FSI turbocharged Octavia RS. Volkswagen also plans to add the VW Polo-sized Fabia next year to the range of vehicles to be sold in Australia. The VW Polo-sized Fabia has been previously presented at the Geneva Motor Show. And by 2009 Volkswagen will launch a new generation version of its long-wheelbase Superb sedan.

The basic selling point of Skoda is its prices and this same strategy is what the automaker will also employ in Australia. The prices of Skoda vehicles to be sold in Australia will start from $16,000 for the Fabia and up to the mid $40,000s for the Superb.

And although Skoda vehicles are built using and components it is still 5 to 8 percent cheaper that its equivalent Volkswagen models due to the low-cost production price at Eastern Europe. Volkswagen Group Australia executive this makes the Skoda especially appealing to cost-conscious Australian buyers who wants European cars.

The plan to sell Skoda in Australia has been developed last year, however pricing and local identity issues have delayed the plans. But now since everything has been finally settled the moving is finally moving forward with its plans.

Matthew Weisner Volkswagen Group Australia general manager, press and public relations have been appointed head of Skoda Australia and part of his responsibility is to re-launch the brand. The first Octavia and Roomster are to be sold through 15 VW dealerships. Wiesner also emphasized the Skoda and VW would be distinct even with BMW which sells its Mini brands through associated dealers. "You won't see shared Volkswagen-Skoda showrooms. We've got to give them more separation. Obviously we need to protect what we've done with Volkswagen but at the same time grow the Skoda branding," said Weisner.

But eventually half of VW's 56 dealers nationally will be made to sell Skodas. "By the end of 2008 we'd like to have about 25 dealers. The regional-rural side of the business will be very important, particularly with Skoda's turbo-diesel line-up," added Weisner.

After-sales services are also going to be improved and with the well developed network and highly trained technicians, servicing and logistics is not going to be a problem. Despite the seemed to be flawless sales plan of Volkswagen in Australia, Weisner is still worried that the company's lack of profile may affect the sales turnover. It should be noted that Skodas have not been sold in Australia for almost 25 years.

"We've got to be creative about how we sell the Skoda message. We need to reasonably clever in how we go about it. It's a pretty congested market, so we have to come up with a reasonable answer to the question of why you would consider a Skoda," explained Weisner. He also described himself as"cautious but optimistic" about Skoda.

Presently there 41 different passenger car brands that are fighting to take a slice of the sales pie and Skoda must try to find its way through the ultra competitive market. Another fear of Weisner is that the Skoda may cannibalize VW sales. But then he said, "Yes, we have to be mindful of that. That's why it has taken such a long time to put this together. We need to be very careful how we approach both marques, because there's no point robbing Peter to pay Paul. You get one opportunity to do it properly."

Weisner also admitted that positioning Skoda without affecting the VW sales is one of the challenges that he is facing right now. "We're hoping the Skoda buyer will be an aspirational European buyer who might not have been able to stretch themselves before. They might always have been Japanese buyers who have aspired to Europe and hopefully we'll give them that opportunity," said Weisner.

Last year has been a very good year for VW Group Australia by selling more than 20,000 vehicles and they are hoping that the coming of the Skoda will further help VW Australia to increase their sales.

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