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Skoda eyes modest sales boost

On the rise: Sales of Skoda’s third-generation Octavia (left) are expected to get a boost from the introduction of the RS sports variant this week and the jacked-up Scout wagon early next year.

Refreshed model line-up to lift Skoda in Australia, but not until 2015

20 Mar 2014

SKODA’S Australian operation is expecting incremental growth on the back of a renewed model range – starting with Octavia – that will bare fruit over the next two years.

The Czech brand will continue its model rejuvenation the with a facelifted Superb large sedan and wagon about mid-year, followed by the updated Yeti compact SUV shortly after, while a new-generation Fabia is due in 2015.

This follows on from the third-generation Octavia mid-sizer that arrived in its standard form late last year and the performance-focused RS that launched locally this week.

After selling in middling numbers in its first few years in Australia, thanks to a limited line-up, Skoda finally kicked into high gear in 2011 with a full line-up on offer, shifting 3501 units, more than double the previous year’s total of 1652 vehicles.

Skoda experienced a slight sales increase in 2013, with 3555 vehicles finding homes compared with 3502 in 2012.

The highest performing models for the Czech brand last year were the Octavia on 1237 sales, up 35 per cent over 2012, followed by the quirky Yeti compact-SUV that experienced an 11 per cent boost, with 1129 units shifted.

Coming in third was the aging Fabia light-car on 555 sales, a 23 per cent drop on the 2012 number, while the Superb large sedan and wagon recorded a 33 per cent fall for sales of 436 units.

Last month, Skoda announced it would discontinue its unusual Roomster tall-boy hatch in Australia after trying unsuccessfully for a second time to make the model work in this market. The Roomster recorded just 102 sales for 12 months of 2013.

Speaking with GoAuto at the launch of the Octavia RS this week, Skoda Australia director Michael Irmer said while he expected an increase in overall sales for 2014, he admitted that the full effect of the new-model influx might not be felt until 2015.

“This year is a transition year, so even though the new models have a lot of potential, we are about to launch them mid-year, so we won’t get their full potential inside the year,” he said.

“Even in the post-launch period we still have these things like building up an order bank or maybe there would not be sufficient supply on all variants, so it will take time to build momentum. Normally you say in the first year of full supply a model comes to its full potential.”

Mr Irmer remained coy when asked what kind of sales increase he expected in 2014.

The third-generation Octavia which has experienced a sales downturn of 24 per cent in the first two months of 2014 compared to the same period last year.

Mr Irmer said this was because a number of key variants were yet to launch, including the performance-honed RS which makes up about 30 per cent of overall Octavia sales and the jacked-up Scout wagon which will arrive in early 2015.

The $21,690 plus on-road costs starting price for the base Octavia sedan has attracted new customers to the brand, with Mr Irmer confirming back orders for the keenly priced mid-sizer.

“We simply don’t have enough stock of these cars. Customers have to put forward orders in to wait a couple of months,” he said.

Skoda is unlikely to fight for fleet buyers, with Mr Irmer saying that that was not a priority for the brand in Australia.

“It is not a core focus for us,” he said. “Having said that we will still look into fleet opportunities, but it is in some cases unhealthy business so we have to be mindful of what we do.

“At first we have to get our core business right which is on the retail side and I think there is a lot of work to do to get right.” Since its launch in 2007, the Skoda brand has been something of an unknown quantity in Australia and Mr Irmer said the company needs work on promoting the quality of its products to remind buyers who they are and why they deserve to be put on shopping lists.

One way to do this is by leveraging the positive reviews and good word of mouth of models such as the Octavia and more recently its RS performance variant.

“Together with the launch we will have advertising campaigns for the Octavia RS as RS is such an important model for us it also has a halo effect for the entire brand and for the Octavia model. But we use this as the perfect platform to work on the brand going forward.”

The company has also redirected funds used for marketing and promotion to use in other areas, with Skoda ending its sporting sponsorships of fledgling AFL club Greater Western Sydney Giants late last year.

“The partnership came to a natural expiry of contract at first so it was not decided to consciously not to be involved,” he said. “And the reason is from our side is we had to look into how do we start our marketing investment.

“In the past it was such big job for us to just bring the brand name Skoda out and that it actually is a car brand and those past sponsorships have achieved a good job there.

“Going forward, we know the biggest job is to tell the people about what cars we offer and what is good about them and why they should consider them with their next car purchase. And that is why we are allocating funds into different channels.”

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