Škoda wants to continue to grow in 2011

PRAGUE, Czech Republic - After the record year 2010 with 762,600 sold vehicles, the Czech automobile manufacturer expects a continuation of the growth course for the current year. For the first time, Škoda cracked the threshold of three quarters of a million. Until the year 2018, Škoda wants to double its annual sales to at least 1.5 million units. To achieve this, the company has launched an extensive product and market offensive and plans to increase production at all locations. Škoda concluded the year 2010 with a positive result. Sales revenue rose 22.4% to €8.692 billion. The operating profit was more than doubled to €447 million.

“The year 2011 is – exactly 20 years after the entry of Volkswagen – a year of setting the course and setting out to new horizons for Škoda,” said the chairman of the board of Škoda, Prof. Dr. h.c. Winfried Vahland, within the framework of the annual press conference in Prague. “We began the new year very well and have seamlessly followed up on the record sales year 2010,” said the chief financial officer of Škoda, Winfried Krause.

In the first two months of the year 2011, worldwide sales of the brand have already risen almost 25% to 132,100 vehicles compared to last year. “We will resolutely expand our position in the markets and expect a continuation of the growth course this year. To do so, we plan to increase the production at Skoda locations, both in our home market of the Czech Republic as well as outside of Europe,” said Winfried Vahland.

Within the framework of the Škoda Growth Strategy developed in 2010, the company wants to double its sales to at least 1.5 million units until the year 2018, measured at today’s volume. “We do not want to be satisfied with what we have achieved and we will shift into a higher gear. Škoda has great potential and is on the verge of a growth spurt. That applies equally to our activities in the markets and to the expansion of the model range,” Winfried Vahland emphasized.

A central element of the plans is the increased internationalization of the company. While market growth in the core European markets is expected to be rather moderate, Škoda expects a continued dynamic development in the emerging countries China, Russia, and India. “We’re charging ahead in all regions and want to participate intensively in the upswing in the booming regions of the automobile industry,” said the Škoda boss. Until the end of the decade, the manufacturer expects a growth of the global automobile market to an annual volume of about 85 million units: “We have good years ahead of us in the automobile industry – that provides us with additional tailwind.”

For this purpose, Škoda invests extensively in new products and wants to excite new customers in new market segments for the brand. A first glance of the new design language of the models was provided by the design study “VisionD”, which was presented at the Geneva Motor Show. Still this year, the new "City Car” will be the first vehicle within the framework of the product offensive to be launched in the market. Winfried Vahland: “This car is our answer to the increasingly strong demand for small cars with low fuel consumption and affordable costs of operation and offers a new sales potential in Europe for us.”

In 2012, another strategic step will be taken in the model policy: a compact sedan – located between the models Fabia and Octavia – shall open up another high-volume element for Škoda. All new models will continue to fulfill the brand promise “simply clever” without change: practical vehicles with an optimal offer of space and an outstanding price/value ratio.

In its growth strategy, the company builds on a healthy starting position. In 2010, sales reached a new record level of 762,600 units. In almost all markets, Škoda was able to grow and gained market shares. Škoda recorded the most dynamic development in the overseas markets of Asia with a plus of 48 percent. In its home market of the Czech Republic, Škoda expanded its leadership position to a market share of more than 34 percent. In Eastern Europe, the sales increase amounted to 22%. A slight decline was recorded – due to the expiry of state-subsidized aid programs – in the sales in Western Europe.

The top-selling vehicle in the past year was the Octavia with worldwide sales of 350,000 units.

The key financial figures of the company also developed in a positive way. Sales revenue rose 22.4% to €8.692 billion. The operating profit was more than doubled to €447 million compared to the previous year. Net liquidity was also improved significantly and has reached €1.605 billion. Profit before tax amounted to €418 million.