According to recent reports, Volkswagen subsidiary, Skoda Auto is planning to introduce a mini SUV into the market which will be priced lower than Rs.10 lakh. This SUV will mark the global company’s first entry into this price bracket.
While global auto giants like Skoda, Hyundai, General Motors, Toyota and Mitsubishi sell their SUVs in the Indian auto market, they are all priced over Rs.15 lakhs. The new proposed SUV from Skoda will prove a direct challenge for Indian companies who offer much cheaper options. Scorpio from Mahindra & Mahindra has a price range between Rs.7.43 to Rs.12.39 lakhs, whereas the Safari Dicor from Tata is priced between Rs.8 to Rs.13 lakhs.
The new SUV from Skoda would challenge the mid-sized luxury sedan market in India, which includes the newly launched Hyundai Verna, Volkswagen Vento and the Honda City.
Skoda India’s board member responsible of marketing and sales, Thomas Kuehl, said that the growth of the SUV segment is not as fast according to their expectations. As a result of this, they are looking at introducing a product priced within the Rs10 lakhs. Kuehl did not however give any information as to when the model will be launched.
He added that they have more than 25% market share in D segment with their Superb, and about 16.5% market share with the Laura. They are currently working on increasing their presence in SUV segment.
In 2010-2011, around 324,000 SUV models were sold in the Indian market, a growth of 19% in comparision to 2009-10 when around 272,000 models were sold. The SUV segment has been witnessing a growth of 15% to 20% annually since the past four years. Almost half of the SUV sales were from home grown company, Mahindra & Mahindra, which managed to sell around 170,000 SUVs in 2010.
The second biggest company in terms of SUV sales was Japanese auto giant, Toyota with their Fortuner, priced a lot higher, above Rs.20 lakhs, according to ex-showroom Delhi. With the launch of their Yeti SUV last November, Skoda was aiming for a 20% market share.
The Yeti had a price ranging between Rs.15.35 lakh to Rs.16.73 lakh according to ex-showroom Delhi. The model failed to witness high sales, with market experts citing the high price as its main grouse. So far, around 900 models of the Yeti had been sold according to Kuehl, and they are also getting to launch another variant of this model sporting a smaller diesel motor. A petrol engine variant could also be on cards.
Skoda is also looking forwards to launching an entry level sedan in 2011 year end. This sedan could be priced between Rs.6-10 lakhs and will compete with the Indigo Manza, Mahindra Logan and Swift Dzire from Maruti. They are also creating a small car which they hope to position below the Fabia, and expect their sales to double to 40,000 vehicles this year. In 2010-11, the company had sold around 22,969 vehicles, an increase of 31.24% in growth compared to 2009-10.