volkswagen: Skoda Auto Volkswagen eyes 40% jump in exports in 2022, kicks off exports of T-Cross to Mexico

Europe’s largest automotive group, which is using India as a beachhead to develop South East Asia and Africa markets, will be adding 10 new countries to build its volumes. The company on Thursday kicked off exports of all new SUV Volkswagen T-Cross to Mexico, its largest export market over the last decade.

Christian Cahn von Seelen, the Chairman of the Skoda Auto Volkswagen India Private Limited told ET, the new range of cars under India 2.0 will allow the group to add new cars and new markets to the Group globally.

“India is going to play a bigger role in the coming decade as the Group transitions from ICE vehicles to EVs. The production of compact vehicles India will continue to drive the global volumes of ICE cars in the future,” he added.

Christian says Triad markets of Japan, Europe and US will fast move towards electrification, hence many compact vehicles, which are being produced in Europe may not be produced in the future, yet those vehicles will be demanded in the other parts of the world in the foreseeable future and there India has a potential develop into a much bigger exports base to cater to demand for ICE vehicles.

The Indian base however should create prerequisites like forming Free Trade Agreements and possibly become part of RCEP, which will allow the country to tap into much bigger exports markets in the future, said the chairman.

Given the fact that India is a launch market for several vehicles, a priority is given to the country, yet the Group continues to face shortage much like other car makers – but are relatively better placed.

The chip concerns will remain for the first half of the year, however things are much better than last year, opined Christian.

The Group has so far exported over half a million cars from India in the last decade with made in India cars being sold over 61 countries. At its peak, Skoda VW exported over 90000 cars annually in 2017 and helped the Group utilise the factory better and stay in green. Mexico is the largest export market for the group followed by South Africa and Central American countries (Columbia, Ecuador, Argentina) and ASEAN countries.

Apart from exports of the Volkswagen T-Cross, the Group will be shipping Kushaq, the Skoda Slavia and a new-mid size sedan from the VW brand in the coming years.

While the exports accounted for almost half of Group’s total production in the last decade, with made for India cars like Skoda Kushaq and Skoda Slavia and Volkswagen Taigun, Skoda Auto Volkswagen is eyeing a much bigger domestic play. Christian says over the mid-term, he sees one third of the company’s total production catering to the export market, with 2/3rd meant to serve the domestic market.

The Group is set to start its third shift this quarter and it has started producing the mid-size sedan Skoda Slavia and a sedan alternative from Volkswagen will also be added later in the year.

Skoda Auto Volkswagen is planning to double its domestic volumes in 2022 with 18 new model launches planned for the current year.