Škoda Auto expands to Vietnam. Next year they will start selling cars, and a year later they will also start production

Škoda Auto from Mladoboleslav has definitively confirmed that it is entering the Vietnamese market. It will start selling its European models there in 2023. From 2024, they will be joined by cars that are currently produced in India, specifically the Kushaq models and a little later also the Slavia. They will be assembled directly in Vietnam. The automaker believes that it will sell up to 40,000 Škoda cars a year on the new market.

 

"Entering the Vietnamese market is the next logical step in our internationalization strategy. Our attractive model portfolio offers customers the right products to leverage our strengths in this highly dynamic market. In addition, India's geographical proximity brings great synergistic effects; as early as 2024, we will be importing automotive assemblies from our Indian plant in Pune to Vietnam. Ultimately, this will significantly strengthen our presence in Southeast Asia," says Klaus Zellmer, Chairman of the Board of Directors of Škoda Auto.

 

From 2023, Škoda will import the Kodiaq, Karoq, Superb and Octavia model series from Europe to Vietnam. The company Thanh Cong Motor Vietnam (TC Motor), which will be the local partner of the automaker, will subsequently ensure the sale of these cars.

TC Motor is also currently building a new car production line in Vietnam in Quang Ninh province. It will be completed in 2024. Škoda will subsequently send the necessary parts from India to Vietnam for the production of the Kushaq and Slavia models, whose final assembly will take place in the aforementioned factory.

 

The cars will be sold in Vietnam through a local network of local partners. The first partner establishments are planned in Hanoi and Ho Chi Minh City – both of these cities account for the vast majority of newly sold cars in Vietnam. Skoda plans to expand the sales network to more than 50 partners. The automaker expects to sell around 30,000 cars on the new market in the first years, after 2030 this number should increase to 40,000.

 

Škoda sees potential in the new market thanks to its rapid growth. Vietnam has approximately 100 million inhabitants, yet there are only 34 vehicles per thousand inhabitants. "At the same time, it is likely that European brands will gain importance in Vietnam due to the gradual removal of tariffs on EU goods by 2030. For this reason, we expect the total annual market volume to increase to approximately one million vehicles after 2030," says Zellmer .