Skoda, Stellantis plot courses out of China

Skoda is said to be planning to exit China, with the final decision to be made next year.

Klaus Zellmer, CEO of the automaker, said competition in China is “very fierce.” Zeller said Skoda is considering selling cars instead of making them in China.

Owned by Volkswagen, Skoda arrived in 2005, sharing the key components such as the engine, gearbox and chassis with Volkswagen, Skoda was considered as a more affordable alternative.

In 2018, Skoda sold 340,000 cars in China. But by 2021, that had fallen to 70,000 cars, and in the first ten months of this year, less than 40,000 Skodas cars were sold.

In September, Zellmer said Skoda’s goal was to sell a million cars a year globally, and in the first three quarters, it sold 700,000.

China was once the largest market of Skoda, but it now has dropped to the fourth, trailing behind Germany, the Czech Republic, and India.

In a statement issued to Reuters, Skoda said it is shifting attention to India, the fastest-growing market. In the first three quarters, Skoda almost trebled sales in India.

Another automaker Stellantis is considering a similar strategy. Its CEO Carlos Tavares said in November that the company was weighing options for making EVs in India to lower costs there, but a final decision was yet to be made.

Stellantis sub-brand JEEP is also quitting China.

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