iDnes – Czech car manufacturer Skoda is considering withdrawing its cars from the Chinese market and potentially shifting its focus to India instead.
Whilst the Volkswagen Group, of which Skoda Auto is a part, did not comment on the idea, the head of Skoda, Klaus Zellmer, has discussed the future strategy of his company with the German car magazine Automobilwoche.
Zelmmer said that in China “the competition is very strong” and so the company will “consider how to proceed with our Chinese joint venture partners”. He explained that it’s possible that Skoda will stay on the market but will close down production at its Chinese plant. The CEO argues that there are numerous other markets in Asia which could be promising for the business, pointing out India in particular.
During the interview he also spoke of Skoda’s business dealings in Russia, where Volskwagen and Skoda stopped sales after the start of the Ukraine war. Russia was the second largest market for Skoda Auto in 2021, with 90,000 cars sold. This has meant that Skoda has lost out on around 500 million euros of profit due to the decision to remove their cars from the market.
As for China, the country has been one of the biggest markets for Skoda in the past, but sales have been falling sharply since 2019. According to its annual report, Skoda sold 71,000 cars in China in 2021, equalling a drop of 60% from the previous year. In 2018, the company sold 341,000 cars in the country. One clear reason for this decline has been the impact of the coronavirus pandemic.
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