Shulou(Shulou.com)11/24 Report--

The original title: "it is exposed that Skoda intends to withdraw from the Chinese market. It has become popular with" OEM Volkswagen ", and its next stop is India."

Only sell but not produce in the future

Another joint venture plans to withdraw from the Chinese market.

Skoda, the Volkswagen car brand, is considering withdrawing from China and will make a final decision next year.

"the competition there [in the Chinese market] is very fierce and we will consider with our joint venture partners how to proceed," Klaus Zellme, its chief executive, said in a recent interview.

Source: according to automobilwocheKlaus Zellme, Skoda could consider selling cars only in China, rather than producing cars there.

This means that if you buy Skoda later, you may have to import it.

In fact, as early as last year, there was news that Skoda might withdraw from the Chinese market, and now the news has been confirmed by the company's boss.

Once upon a time, Skoda was also known as a car brand that "people who understand cars buy". Nowadays, with the rapid development of new energy vehicles, Skoda's development in China is beginning to be full of uncertainty.

01. Start to add size to India? The timing of the real exit will be decided next year, which makes it difficult for Skoda to quit or how.

Klaus Zellme said the company needs joint production forces, concentrated elsewhere, and its future development in the Russian market is uncertain.

Source: Skoda, in their view, the competition in the Chinese car market is so fierce that it is hard to say exactly where Skoda will go, Klaus Zellme said, and is discussing the next move with its Chinese partner (SAIC Volkswagen).

However, according to the current trend, Skoda's withdrawal from the Chinese market may be a high probability event.

Skoda's withdrawal from the Chinese market has long been traced, and Skoda's sales in China have fallen sharply since 2019. Skoda sold 71000 cars in China last year, down 60 per cent from a year earlier, according to its annual report.

China was Skoda's largest market in 2018 and 2019, with sales of 3.41 million and 282000, respectively. But then it turned around and fell sharply, and monthly sales continued to halve.

Skoda has saved himself. In order to make the domestic market pick up, in July 2021, Volkswagen Vice President Yue Sitan became Skoda's president of China. He was called the president who knows the Chinese market best, which gave Skoda a glimmer of hope.

But judging from Skoda's performance, it failed to stop the decline in sales. Sales of all Skoda models were 2600 in October this year. Of the seven models on sale, none of them can sell more than a thousand models a month.

Source: Skoda's latest insurance data show that Skoda sold 38022 vehicles from January to October this year. Compared with the same period last year, it decreased by 61.32%.

Following this trend, Skoda's insured volume in China this year is very difficult to exceed 50,000 vehicles, and sales have halved. Last year, Skoda insured a total of 114800 vehicles in China.

Today's Skoda has lost its former position in the market, and it has not kept pace with the transformation of electric cars in China, and it has not carried out a real electric transformation until now.

Source: Skoda in August this year, Skoda unveiled its next plans to launch three pure trams, including a small car, a compact SUV and a seven-seat household SUV, which are expected to be available by 2026.

However, in the face of fierce competition in China's electric car market, it is obviously too late to enter the Bureau in 2026. Even if the electrified transformation is successful, Skoda's Enyaq electric car in the UK, with a price of about 280000 yuan, will hardly have a market in China.

But Skoda is somewhat reluctant to leave China's largest car market.

So Skoda plans to make up for the lost market share in China in India.

Skoda said Skoda would then consider joining other parts of Asia, such as India, which is now one of the most promising Asian markets. "

02, Volkswagen labeled car advantage is no longer as early as 2020, Volkswagen released its third-quarter results, Volkswagen Group sales head Christian Dahlheim once said: "Skoda is in trouble in China."

In August last year, Skoda was reported to be disbanding its marketing team in China, along with its R & D team. Although SAIC-Volkswagen later responded, saying that the news was not true. But there is no denying that Skoda is having a hard time in China.

This year, rumors of Skoda's withdrawal from China have intensified.

As a sub-brand of Volkswagen, Skoda, founded in 1895, has a history of more than 100 years and has been in China for more than ten years.

In 2006, Skoda's first car in China, Mingrui, was put into production in Shanghai Volkswagen, becoming the third Volkswagen brand to be put into production in China after Volkswagen and Audi.

Source: Skoda in the early years, Skoda relied on the label of "cheap Volkswagen" and was once popular in China, bringing Chinese consumers popular models such as bright sharp, Jingrui, Kodiak and so on.

In the years when joint ventures dominated the Chinese car market, Volkswagen, as the representative of German cars, had high prices. Skoda, which is of the same origin as Volkswagen, is cheaper, more cost-effective, and the three most important pieces are basically the same. At that time, the spring of its own brand had not yet arrived, and Skoda quickly gained a foothold in China as a substitute for the masses.

Source: six years after Skoda entered China, Skoda's annual sales in China reached 235000 in 2012, and the Chinese market accounted for 1/4 of its global sales.

In this way, Skoda has grown by leaps and bounds. Skoda's sales exceeded 300000 for three consecutive years from 2016 to 2018, peaking at 340000 in 2018.

But, just as no one is always young, Skoda can't always be at the top.

With the rise of its own brands, Volkswagen German car myth is no longer, at the same time, the company's strategy also began to adjust, Skoda sales in China gradually slowed down.

2019 became a watershed for Skoda's sales in China, when the FAW Volkswagen brand Jetta announced its independence, which made Skoda's price advantage no longer. In just three years since 2019, Skoda's situation in China has taken a sharp turn for the worse.

Source: Skoda's sales declined for three consecutive years in 2019, 2020 and 2021. Skoda sold only 71200 vehicles in China last year, down 58.8 per cent from a year earlier.

Sales fell so much that Skoda decided to launch a "price war" in 2020. Guan Xuan cut the price of its entire range of models by 2500 to 24500 yuan.

But the market did not pay the bill, and sales are the most intuitive data. Skoda's sales have not exceeded 200000 after the price reduction in 2020, compared with 282000 in 2019.

03, the second-line joint venture has begun to decline, in addition to the influence of external factors, Skoda lagging behind is also a big reason, that is, the process of new energy transformation is slow.

At a time when China's new energy market is in full swing, Skoda's pace of transformation is lukewarm. It was not until August this year that Skoda announced plans for electrified models. But it's too late to launch a pure streetcar in 2026.

Source: Skoda, from January to November this year, the production and sales of new energy vehicles in China has exceeded 6 million. Cui Dongshu, secretary general of the Federation of passengers, believes that the market penetration rate of new energy vehicles in China will reach 25% in 2022. The market demand is still very strong, but the supply side is already a red sea.

If the new car-building forces represented by "Wei Xiaoli" have just "survived", then traditional car companies have entered on a large scale. How many opportunities and markets are left for Skoda at this time?

It's not just Skoda. Since the beginning of this year, there have been one after another talk of joint venture car companies entering the darkest moment in China. According to data released by the Federation, joint venture brand production fell 27% in November from a year earlier, down 16% from a month earlier, while sales were down 21.57% from a year earlier and 10.12% from a month earlier.

It can be seen with the naked eye that both production and sales of joint venture brands are falling.

If the decline in production and sales can only show that joint venture cars can no longer be sold in China, it is an indisputable fact that Skoda is suspected of withdrawing from China and the bankruptcy liquidation of joint venture car companies in the past two years.

Source: GAC GROUP not long ago, GAC GROUP issued a notice saying that the joint venture Guangzhou Auto Fick has received a court ruling to accept the bankruptcy application. Guangzhou Auto Fick has been reduced to the past tense, but it is not the first or the last.

Joint ventures represented by Guangzhou Auto Acura, Changan Suzuki and Dongfeng Renault have successively withdrawn from the Chinese market.

To investigate the reason, the failure to seize the opportunity to keep up with the general trend of new energy development is on the one hand, giving independent brands the opportunity to overtake at the bend. On the other hand, joint ventures have been "comfortable" in China for too long.

At that time, they were able to gain a foothold in China, inseparable from the high performance-to-price ratio of products, and good product quality. But now the market is completely different, more and more Chinese brands are coming from behind, and some joint venture car companies can no longer make money lying down.

Therefore, Skoda's trend in the Chinese market is only a microcosm of many joint venture car companies, and will not be the last.

This article comes from the official account of Wechat: Superelectricity Lab (ID:SuperEV-Lab), author: Cao Tingting, Truman, Editor: Zaizhou

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