More localisation, Indian partner on the cards for SAVWIPL

The next phase of SAVWIPL will see higher levels of localisation with the introduction of a compact SUV
SAVWIPL to offer higher levels of localisation in the new compact SUV
SAVWIPL to offer higher levels of localisation in the new compact SUV

With Skoda India firmly in control of the group's direction, the first major product in the pipeline is an as-yet-unnamed compact SUV. The company is making significant strides in localisation, aiming for over 75 percent of the parts to be sourced locally in India. Skoda Auto CEO Klaus Zellmer stated, “Soon we will add a new locally developed model to our line-up in India, specifically in the important compact SUV segment.” He added, “Our sub-4 metre SUV will feature over 75 percent localisation.”

SAVWIPL has encountered challenges in localising the 1.5-litre TSI engine and the DSG gearbox that power the premium variants of the Kushaq and Slavia however, we don't expect the compact SUV to feature either of these. That makes it easier to offer higher levels of localisation in the new compact SUV since the 1.0-litre TSI engine is completely locally produced. This compact SUV will be Skoda’s third product on the MQB A0 IN platform and will have export potential, as Skoda views its Indian operations as a gateway to the ASEAN and Middle East regions. Amid geopolitical tensions in Eastern Europe and China, India has become Skoda's most crucial market outside of Western Europe.

Which is why we will also see a flurry of new model introductions starting next year. Besides the compact SUV, facelifts of the Kushaq and Slavia are on the cards as well as, finally, the launch of the Enyaq EV, new generations of the Superb and Kodiaq and maybe, just maybe, the next generation Octavia too. Premium sedans aren’t selling as well in India and with every new generation, the pricing makes them less attainable than before. Prices for the current Superb for example start at Rs 54 lakh. 

Skoda is also actively scouting for an Indian partner that brings a specific set of skills to the table. The group is known for its engineering might and that will be the focus for SAVWIPL. The expectation is to find a partner that understands the Indian customer well. It need not be a car manufacturer, as it has been speculated in the media that Mahindra could be one of the potential suitors. The Group is open to companies outside the automotive industry as well.

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