Skoda Seeks Ways To Expand Production Due To Growing Consumer Demand

Volkswagen Group is looking for ways to increase the production of Skoda because of the growing customer demand for cars of this Czech brand. They even think about the construction of a new factory outside the Czech Republic.

Successful Kodiaq and Karoq models strengthened the brand’s position in the SUV segment. By 2020, the launch of 19 new models is planned.

The attempt to widen production in Mlada Boleslav is not supported by trade unions, which oppose the prolongation of the working week until Saturday. If they agree, it will be possible to increase the output volumes at the plant in the Czech Republic to 83,000 a year, hiring an additional three thousand workers.

Last year, Skoda outperformed Audi and BMW, having sold 1.2 million cars. Over the past 5 years the brand sales have grown by one third thanks to the Chinese and European markets. In recent years the company has increased production in Russia, India, China. By 2025, it wishes to expand the geography of sales to 120 countries (now there are 100)

The Skoda’s management faces a dilemma: whether to use free facilities of VW Group or to invest in the construction of a new factory not in the Czech Republic. It is not clear yet at which Volkswagen Group’s location it is possible to assemble Skoda models.

Against the backdrop of a costly diesel scandal, it is expected that underutilized production areas will be used, rather than the decision to build the new factory. In addition, the VW Group’s financial plan includes a reduction of capital expenditures and R&D costs by 2020.

Source: Reuters

Photo: the Skoda Kodiaq

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