Volkswagen’s Czech division Skoda stated it will evaluate the possibility of making cars in the United States as it considers selling on the planet’s second largest automobile market where its parent continues to face an emissions scandal.
Skoda, Volkswagen’s mass-market brand name, will begin shipments in Iran, South Korea and Singapore next year and will take some time up until completion of 2017 or later to decide whether to get in the United States, Skoda’s chief executive, Bernhard Maier, stated.
“Based on today’s understanding, a corresponding localization will be necessary to achieve a favorable business case,” Maier said in an interview at the Paris automobile show on Thursday.
“A a great deal of aspects” including analyses of market conditions and competitors, product outlook and sales operations will figure out the final decision, he stated.
“Eventually, business case has to be positive” to authorize a U.S. market entry, he stated.
The move shows Volkswagen’s growing optimism that a series of new items and a project to improve its image will fix the damage done in the United States since its rigging of emissions tests broke over a year earlier.
Though Skoda has actually been examining the potential of the U.S. market for a number of months, it is in no rush to chose as it is tied up with a growth course designed to curb reliance on volatile core markets and protected future growth.
“We truly have our work cut out,” said Maier, citing plans to add more sport-utility automobiles after unveiling the seven-seat Kodiaq SUV in Paris in addition to advancing zero-emission innovation and similar services.
Skoda will start importing completely built cars to Iran at some point next year and has signed initial accords with regional partners to prepare partial CKD production in the country, the CEO stated.
Taxation of vehicles with engine sizes listed below 1.6 liters which are common in Skoda’s design variety are particularly beneficial, stated Maier, who approximates that over 2 million vehicles will be sold each year in Iran following the nation’s nuclear deal the West to terminate sanctions.
Separately, Skoda eyes record car sales and profit this year, thanks to the very first full year of deliveries of its Superb flagship design and stronger-than-expected need for all model lines, Maier stated.
Skoda has a five-digit number of pre-orders for the Kodiaq and intends to double its Chinese sales to about 600,000 automobiles by 2020-21 from over 300,000 this year due to SUV shipments, he stated.