Will Skoda Influence Future VW Offerings?

March 18, 2007 | In Skoda, Volkswagen |

The automotive world is seeing some dramatic changes thanks to the opening up of markets in China and India and the development of plants producing models that can retail for much less than ten thousand dollars in North America. The lower end of the auto market is booming and cheaper priced cars will be soon heading to America to swell the ranks of vehicles selling for bottom dollar. Volkswagen will be doing its part to compete against all that the world has to offer, but not with models currently being built by the German automaker. However, Skoda, a car company owned by the Volkswagen Group is likely to start selling some of their cars in the U.S. once competition heats up. Read on and we’ll take a look at how Skoda may transform the basic Volkswagen offering for the lucrative, but competitive American market.

Ask the average American consumer if they ever heard of Skoda and more than ninety percent are likely to give you a “no” answer. Conversely, if you asked these same consumers if they ever heard of Volkswagen, the name recognition would be virtually one hundred percent. Such is the popularity of the car company that brought the Beetle and Rabbit to the American market.

Skoda is much less known globally, although they have been producing vehicles for more than one century. Indeed, the once Czech government run car company had a small following, mostly in the communist states of eastern Europe. During the early 1990s, the Czech government decided to sell its interest in Skoda and Volkswagen became the happy owner. Today, Skoda cars are made in five countries and sold in 21. New plants in Russia and China are being developed to join plants already operating in eastern Europe and India.

So, why would VW turn to Skoda in order to remain competitive in North America? For two reasons:

Even if VW sends their lowest price car to the American market, the Polo, it will still be priced at around $12,000 which will be several thousand dollars more expensive than the cars to be imported from Chinese automakers.

Already the Skoda is one of the best priced brands in the world. Instead of pouring millions of dollars into a new VW model and tapping a factory that produces more expensive vehicles, a base Skoda model will likely anchor the Volkswagen line up within the next five years. Perhaps the Roomster, Skoda’s tiny four passenger automobile will be the car that helps VW stay strong in the US. Powered by a tiny 3 cylinder 1.2L engine, the Roomster is uniquely designed and easier to tell apart from other cars in its class and the Roomster is likely to be popular in China once production begins late next year.

And what is the biggest advantage of the Skoda Roomster? It will retail for less than ten thousand dollars once imported versions of this car arrive from Chinese factories to American soil. Now for the remaining dilemma: will the car be rebadged as a VW or will America finally learn what Skoda is all about? Stay tuned!

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