Skoda takes a break from compact car, drives in new Superb

The company said its Indian arm has closed after-sales office in Pune as part of the ongoing strategy

Czech auto-maker Skoda is taking a break from selling compact car in India as it is focusing on a financially sustainable business model, for which an organisational restructuring is being implemented to make it leaner and improve its after-sales service.

 

The company, which today launched its premium executive sedan Superb priced between Rs 18.87 lakh and Rs 25.2 lakh, said its Indian arm has closed after-sales office in Pune as part of the ongoing strategy.

 

"We are still selling Fabia (hatchback) but we have stopped production of the car. Our present focus is on strengthening our image as a value for luxury provider," Skoda Auto India Chairman and Managing Director Sudhir Rao told reporters here.

 

He, however, said the company has not completely given up on the high volume compact segment.

 

"We will profitably re-enter the small car segment, once we get the fundamentals sorted out," Rao said, without sharing any time-frame.

 

The company "clearly has volume aspirations, for that we need a volume car in the Fabia segment", he added.

 

The Fabia was launched in India as a premium hatchback competing with the likes of Maruti Swift and Hyundai i20 but didn't make much of a mark.

 

At present the company has made "progress" in the development on an India specific compact car based on the platform of mid-sized sedan Rapid, Rao said but did not share when it would be launched here.

 

The company's main models in India are sedans Superb, Octavia and Rapid along with sports utility vehicle Yeti.

 

Rao said Skoda India has been streamlining structures in the company as part of an exercise to make in lean and nimble footed to be able to respond to market demand quicker.

 

"In 2013 our focus was to improve our business. We have done a lot to make it leaner, with less people. Our Pune aftersales office has been closed and we are operating only from Mumbai and Aurangabad," he said.

 

When asked about the number of people which left the company, Rao didn't share an exact number but said the Pune office had about 25 people, while several have been relocated some moved on.

 

"This year, you will see a lot of improvement in our aftersales, customer relationship and product planning. We will have a financially sustainable business...We have make significant improvement in financials, except for one-off issue," Rao said  without elaborating on the financial issue.

 

Admitting that the company had issues with after-sales, he said Skoda India has worked on reducing the number of days taken for repairs of cars drastically.