Skoda India sees 2003 sales nearly doubling

The Indian unit of Czech carmaker Skoda Auto said on Monday it expected its sales in 2003 to nearly double from a year ago helped by three model launches and a four to six per cent growth of the premium car segment.

Skoda, a unit of German automaker Volkswagen AG, has been in India since November 2001 when it began assembling and selling the Octavia sedan in two versions.

The Octavia, which has a showroom price of about Rs 1.2 million, is positioned in the low-volume, premium end of India's new car market of more than 500,000 units a year.

"We plan to sell 8,500 cars this year after doing about 4,400 cars in 2002," Imran Hassen, managing director of Skoda Auto India Pvt Ltd, told Reuters on the phone from the company's car plant in Aurangabad in Maharashtra.

Hassen said Skoda would introduce the Laurin & Klement sedan in the next two months, an automatic version of the Octavia in June and the Superb, a larger luxury car with a 2.8 litre petrol engine, later in the year.

The Superb is expected to be priced at about Rs 2.5 million and will compete with other cars such as the Mercedes Benz C-class.

Hassen estimated the premium car segment at 30,000 units a year and forecast it to grow at about 4-6 per cent this year. The segment grew by four per cent in 2002.

Nearly 83 per cent of India's new car market is made up of small hatchbacks priced up to Rs 500,000.

Hassen said Skoda was increasingly beginning to use locally made parts in the Octavia and would aim to boost Indian content in the car to 62 per cent by end-2003 from 41 per cent. The car is currently assembled from imported semi-knocked down kits.

Hassen said Skoda would also look to exporting cars to Southeast Asia in 2004 from India after the local operations had stabilised and it had achieved domestic sales of 8,500 units a year.

The company, which has invested $27 million in India, expects to break even by mid-2004.