Škoda Auto delivered more than 730,000 vehicles in 2022 in an extremely challenging market environment. The company has adopted important future-proofing measures, including further internationalisation, an accelerated e-campaign and an entirely new brand design. Thanks to the successful strategy in India, the Czech car manufacturer more than doubled its deliveries (+127.7% year-on-year) on the sub-continent. Škoda is consistently advancing its internationalisation strategy by entering the Vietnamese growth market this year, strategically leading the Brand Group Volume in the ASEAN region, strengthening its presence in Southeast Asia and expanding business activities in the Middle East. At the same time, the brand is focusing on electrification in its home market: Škoda Auto launched the production of MEB battery systems at its Mladá Boleslav plant in May 2022, with a second production line opening this year to expand capacities to 1,500 units a day. In addition, Škoda Auto has stepped up its e-mobility offensive; the company will be launching three more battery electric vehicles (BEVs) by 2026, with more to follow. Škoda aims to boost the BEV share of deliveries in Europe to more than 70% by 2030 and will be investing 5.6 billion euros in electrification by 2027.

Škoda Auto CEO Klaus Zellmer, says: “Škoda Auto has demonstrated its resilience throughout 2022. Despite the various challenges our industry is facing, we sharpened our strategic focus by unveiling a new design language and corporate identity, launching the production of our MEB battery systems, accelerating our e-mobility offensive and advancing Škoda Auto’s internationalisation. We are going to use our entry into the Vietnamese market to drive the Volkswagen Group’s growth across the ASEAN region, for which we recently assumed Brand Group Volume strategic leadership. At the same time, we will be focusing on significantly expanding our business activities in the Middle East. Through these measures, we are future-proofing the company and positioning it to best serve our customers with attractive and highly efficient products from both worlds – EV and ICE.”

Model portfolio meets strong demand; Fabia RS Rally2 to continue Motorsport tradition
The Škoda Octavia continued to be the brand’s bestseller in 2022 with 141,100 units delivered to customers. Demand also remained high for the Kamiq (96,300 units) and Kodiaq (94,500 units) SUVs, followed by the Fabia (92,700 units). The launch of the dynamic, efficient, and sustainable Enyaq Coupé iV provided further impetus for the successful all-electric Enyaq iV family: In 2022, 53,700 units were delivered to customers. The top RS version of the Enyaq Coupé iV was introduced as the first BEV in the sporty Škoda RS range at the end of January. In December 2022, the Czech car manufacturer also launched the Enyaq RS iV SUV. In addition, Škoda presented the popular Monte Carlo trim line for the fourth-generation Fabia, complementing the offer in the entry-level-segment. In June, Škoda Motorsport unveiled the Fabia RS Rally2. As the successor to the Fabia RS Rally2 evo – the most successful rally car in its category – the Fabia RS Rally2 has all the credentials to continue its predecessor’s legacy.

Parts supply: More MEB batteries for the Volkswagen Group, production of wire harnesses mirrored
In terms of component production, Škoda Auto has taken an important step towards establishing the Czech Republic as an e-mobility hub in the past year: In May 2022, the company launched the production of battery systems for BEVs based on the Volkswagen Group’s Modular Electrification Toolkit (MEB) at its main plant in Mladá Boleslav. The investment in the newly built production line totalled around 130 million euros. Another assembly line will be added this year, raising the total capacity to 1,500 batteries a day. The MEB battery systems manufactured in Mladá Boleslav will not only be installed in Škoda models but also in vehicles built by Volkswagen, Audi and SEAT. Mladá Boleslav is the only European location outside Germany where battery systems for MEB vehicles are produced.

Another measure aimed at securing component supplies further demonstrated Škoda’s resilience under very challenging conditions in 2022: In the first half of the year, production of the all-electric Enyaq iV had to be suspended for eight weeks due to supply bottlenecks caused by the war in Ukraine. To best meet customer demand and reduce the high order backlog, the car manufacturer relocated part of its Ukrainian component production to Mladá Boleslav in close cooperation with suppliers. These steps enabled manufacturing capacities to be duplicated in Europe and North Africa within only a few weeks.

Internationalisation: Škoda Auto is rolling out its strategy
Under its Next Level – Škoda Strategy 2030, the company continuously evaluates potential new market entries. The car manufacturer is thus pressing ahead with its internationalisation strategy, leveraging growth potential for the Volkswagen Group in promising growth markets.

The strategy is yielding results in the key market of India; Škoda more than doubled its deliveries there in 2022 (+127.7% year on year) and will be strengthening its presence in Southeast Asia: The carmaker is on the cusp of entering the dynamic Vietnamese market and is also strategically leading Brand Group Volume in ASEAN, which represents a strategic gateway to the broader Indo-Pacific area. ASEAN is the fastest-growing region in the world with a strong overall economy (+ 8% per year) and a market volume of over 4.1 million vehicles in 2030. Its geographical proximity to India also offers significant synergy effects.

Synergies also play a major role in Škoda’s involvement in the Middle East, where the company projects a potential annual sales increase to around 5,000 units over the next three years. Škoda joined Audi Volkswagen Middle East on 1 February 2023 in order to integrate the Czech car manufacturer into the existing National Sales Company for the Audi and Volkswagen brands.

Sustainability: Pursuing clearly defined ambitious goals
Škoda Auto is pursuing its ambitious goals in another area of its Next Level Škoda Strategy 2030, too: The company takes a holistic approach to sustainability along the entire value chain. In terms of sustainable production, Škoda is incorporating increasingly more recyclable materials in its models. In addition, the company is committed to recycling the high-voltage batteries from its e-vehicles. Škoda Auto will also be operating its three Czech plants with net-zero carbon emissions by the end of the decade. The share of renewable energies at the Czech sites was around 35% in 2022. At the plant in Pune, India, Škoda recently commissioned one of the country’s largest solar-power rooftop systems in the automotive industry, covering up to 30% of the plant’s total energy consumption.

Regarding the decarbonisation of its fleet, Škoda Auto aims to reduce fleet emissions by more than 50% by 2030 compared to 2020. During the transformation phase, vehicles with internal combustion engines (ICE) will also play a crucial role for Škoda; the carmaker is consistently optimising its economical and modern ICE models and will be presenting the new generation of the Superb and Kodiaq model series later this year. Both models will be available with plug-in hybrid drives too, a first in the Kodiaq model range.

2023 outlook: Introducing new models and setting the course for a successful future
Škoda Auto expects the overall situation to remain challenging throughout 2023, yet the company remains on track; the Next Level – Škoda Strategy 2030 is delivering results, and the attractive, modern portfolio has been very well received by customers. To advance the brand’s positive development, Škoda will be introducing the next generation of its successful electric SUV family, with the refreshed Enyaq iV featuring the new Modern Solid design language.

The strategic foundation for the company’s dynamic expansion has been laid, and the new brand identity ‘Explore More‘ is leading the way. It brings with it a new design language, a new logo and the most radical change to its corporate identity in the last 30 years. As part of ‘Explore More’, unveiled at the end of August 2022, the car manufacturer is stepping up its e-mobility offensive; the company will be introducing three new BEVs in the small, compact and large segments as early as 2026. The first insights will be presented in the second quarter of 2023.

The goal is to offer a complete range of electric products from entry-level cars to spacious family vehicles and boost the BEV share of European sales to more than 70% by 2030. To achieve these objectives, the car manufacturer will be investing 5.6 billion euros in electrification and a further 700 million euros in digitalisation by 2027.

Škoda Auto Group generates solid earnings for 2022 within challenging environment

• Škoda Auto Group¹⁾ increases revenues in 2022 to more than 21 billion euros
• Operating profit significantly impacted by financial burdens due to the war in Ukraine and subsequent suspension of business activities in Russia
• Return on sales of 3 per cent
• Škoda keeps investing in future technologies: 5.6 billion euros in e-mobility and 700 million euros in digitalisation by 2027
• The Next Level Efficiency+ program has been implemented and is running on track

Mladá Boleslav, 16 March 2023 – The Škoda Auto Group¹⁾ delivered 731,300 vehicles worldwide in 2022 and increased its revenues year-on-year by 18.5% to 21 billion euros (2021: 17.7 billion euros). The market environment remained challenging due to the ongoing semiconductor shortage, persisting supply chain issues and a substantial increase in raw material prices. Thanks to effective countermeasures, the car manufacturer managed to achieve a positive operating profit amounting to 628 million euros (2021: 1.083 billion euros; -42%). This was attained despite the financial burden of extraordinary effects regarding the situation in Russia. The negative impacts related to the business in Russia were estimated at almost 700 million euros. Therefore, the return on sales without these extraordinary effects slightly exceeded last year’s 6.1%, but dropped to 3.0% including extraordinary effects. Despite the current challenges, Škoda continues to be financially sound, pushing the internationaliziation of the company and keeps investing heavily into electromobility and digitalization.

In 2022, several external factors impacted the company’s financial results: The sharp rise in the price of raw materials, the ongoing shortage of semiconductors and the financial burdens from the war in Ukraine made for a highly challenging market environment. Yet, thanks to efficient counter measures taking effect, the Škoda Auto Group¹⁾ was able to effectively mitigate the financial burdens.

Although the negative impacts related to the war in Ukraine and the extraordinary effects from the situation regarding Russia were estimated at almost 700 million euros, most of the key financial figures remain at a solid level.

The operating profit amounted to 628 million euros in the past fiscal year. Sales revenue in 2022 was significantly up on the previous year at 21 billion euros, (+18.5%). The return on sales remained positive at 3% while it fell by 3.1 percentage points, equally mirroring the financial hardships. The company managed to maintain a steady net cash flow at 489 million euros (2021: 554 million euros; -11.7%).

Klaus Zellmer, Škoda Auto CEO, says: “Against the backdrop of what is likely to have been the most challenging market environment in the company’s history to date, Škoda Auto achieved a very solid financial result and proved once more its extreme resilience. Many have contributed to the fact that we were able to steer through this challenging year well. A big “thank you” to the entire team of 45,000 Škodians for their passion and commitment, but also to our dealers and partners worldwide. Together, we kept the company on track to deliver as many cars to our customers as possible. In 2022, we delivered 731,300 vehicles and generated a solid operating profit of 628 million euros. And also thank you to our faithful customers for their trust and continuously strong interest in our products, that particularly applies to our Enyaq iV family: Its sales increased by 20% in 2022. Furthermore we are heavily investing in the future of our company and conquer promising new growth markets and regions like South-East Asia as well as India. We take the comprehensive measures to make sure that Škoda Auto emerges from the current upheaval even stronger.”

Christian Schenk, Škoda Auto Board Member for Finance and IT, adds: “We managed to increase our sales revenue by almost 20% year-on-year – despite comparatively low sales figures. The market is currently heavily distorted and the extraordinary effects from the situation regarding Russia negatively impacted our financial figures in the amount of almost 700 million euros. We effectively countersteered primarily with improvements in pricing, sales mix, and reinforcing the business in India. We also optimized fixed costs for production and administration whilst freeing up resources for the further transformation and future viability of the company. Between 2022 and 2027, we will invest significantly in electric mobility and comprehensively digitalise our vehicles throughout the entire user journey for example, including safety functions and connectivity. In order to achieve sound financial results and an ambitious Return on Sales target of more than 8% from 2025, the company has implemented the Next Level Efficiency+ Program from 2022.“ 

Future viability thanks to efficiency programme and extensive investments
The company is continuing to press ahead with the Škoda Next Level Efficiency+ programme. By 2027, the Czech carmaker has set aside 5.6 billion euros for the transformation towards electric mobility. In the same period, Škoda will invest a further 700 million euros in digitalisation and also forge ahead with the internationalization of the company.

Latest annual report available on http://reporting.skoda-auto.com/ and on the Škoda Storyboard.

Škoda Auto Group¹⁾ – Key figures from January to December 2022²⁾

¹⁾ Škoda Auto Group comprises ŠKODA AUTO a.s, Škoda Auto Slovensko s.r.o., Škoda Auto Deutschland GmbH, Škoda Auto Volkswagen India Pvt. Ltd. and OOO Volkswagen Group Rus.
²⁾ Percentage deviations are calculated from non-rounded figures.
³⁾ comprises production in the Škoda Auto Group, excluding production at partner assembly plants in China, Slovakia, Russia and Germany, but including other Group brands such as SEAT, VW and Audi; vehicle production excluding part/complete kits.
⁴⁾ comprises Škoda Auto Group sales to distribution companies, including other Group brands including SEAT, VW, Audi, Porsche and Lamborghini; vehicle sales excluding part/complete kits.

Expanding global footprint: Škoda Auto strategically leads Brand Group Volume in ASEAN and extends business in the Middle East

• ASEAN: Škoda Auto to strategically lead the Brand Group Volume and maximise growth potential for the Volkswagen Group
• Vietnam: Market entry this year; completely knocked down (CKD) production planned for 2024
• India: Key market in Škoda’s internationalisation plans and future export hub
• Middle East: Škoda Auto expands business activities, joined National Sales Company (NSC) Audi Volkswagen in early February
• Exploring dynamic growth markets a central pillar of Next Level – Škoda Strategy 2030

Mladá Boleslav, 16 March 2023 – Škoda Auto is forging ahead with its internationalisation strategy: The Czech manufacturer will be strategically leading the Brand Group Volume in its future expansion across the ASEAN region and maximise growth potential for the Volkswagen Group. The company will draw on its expertise in price-sensitive entry-level segments and effectively leverage existing potential. Škoda Auto is on the cusp of entering the Vietnamese market with imported models in 2023 and local CKD production planned for 2024. India is set to become an export hub for the Czech car manufacturer as a further step in to successfully implementing its India strategy. Additionally, Škoda Auto will be taking the next step in the Middle East by further expanding its business activities and leveraging comprehensive synergy effects with its production in India.

Klaus Zellmer, Škoda Auto CEO, says: “We are expanding Škoda’s global footprint by taking over the strategic leadership of the Brand Group Volume in the ASEAN region. This shift in responsibilities underscores the trust and confidence the Volkswagen Group has in the expertise of the Škoda team. We have a clear roadmap and a long-term vision for the region. Our goals are ambitious but achievable: We want to secure a market share of over five per cent for the Brand Group Volume, and we are taking the lead to leverage the immense growth potential in these markets.”

Martin Jahn, Škoda Auto Board Member for Sales and Marketing, adds: “ASEAN is the fastest-growing region in the world with a projected market volume of more than 4.1 million vehicles in 2030. We are convinced that our model portfolio has tremendous potential in this region. Alongside our strong partners, we are developing and expanding production capacities and the sales network. I am sure that we will quickly gain a foothold locally. At the same time, we will be stepping up our business activities in the Middle East; we see great opportunities there and expect to significantly increase our sales.“

Internationalisation as an integral element of the corporate strategy
Thanks to its Next Level – Škoda Strategy 2030, Škoda Auto will be even more international by 2030. To this end, the company is continuously evaluating and developing promising markets for the Volkswagen Group.

In Asia, Škoda Auto already bears Group responsibility for the Indian market. Now, the brand will be strategically leading the entire ASEAN region as part of the Market & Regions Sales Steering of the Volkswagen Brand Group Volume. The aim is to establish Škoda as a strong brand in the region, achieve profitable long-term growth in the volume segments and a significant Group-wide market share in the respective markets. The Czech car manufacturer is now developing a regional steering strategy for these important growth markets.

ASEAN growth region
The ASEAN region offers promising growth opportunities; the overall economy is growing by 8% annually. The automotive market is projected to encompass more than 4.1 million vehicles in 2030. The strategic advantages include geographical diversification of production activities, synergies with other regions where Škoda is active and free-trade agreements encouraging product localisation. In addition, the car manufacturer will be drawing on its considerable experience in the Indian market to strengthen its position in the competitive market.

Škoda anticipates significant sales potential in ASEAN and will contribute its expertise in the price-sensitive entry-level segments – competitive A0 vehicles under 20,000 euros. Saloons and SUVs, in particular, have major potential in these markets. With an estimated electrification rate of around 30% by the beginning of the next decade, the future in the market also lies with electric-drive vehicles.

Vietnam: Gateway to the ASEAN region
Škoda Auto considers Vietnam the strategic gateway to ASEAN and the broader Indo-Pacific region. In cooperation with Thanh Cong Motor Vietnam (TC Motor) as the local partner for production and sales, Škoda Auto will gradually start importing the Kodiaq and Karoq this year, followed by the Superb and Octavia series from Europe in 2024. Local production of the Kushaq and Slavia from India from CKD format will commence in 2024 in Quang Ninh Province. The electric Enyaq iV family will round off the offering on the Vietnamese market from 2025 onwards.

Taking into account Škoda Auto’s responsibility for the global development of the MQB‐A0 platform within the Volkswagen Group, Vietnam represents an important customer base for Škoda products based on this platform.

Škoda Auto is projecting a rapid expansion of the dealer network to more than 50 partners and an annual sales potential of 30,000 units initially, increasing to over 40,000 units from 2030.

Vietnam has considerable growth potential in terms of gross domestic product and unit sales, its automotive market is extremely dynamic; there are currently only 34 vehicles per 1,000 inhabitants – with a population of around 100 million people. Nonetheless, Vietnam is already the fourth-largest automotive market in Southeast Asia.

With the gradual removal of customs duties on goods due to the EVFTA (EU – Vietnam Free Trade Agreement), Škoda is anticipating a strong increase in the sale of vehicles manufactured in the Czech Republic and imported into Vietnam.

Major success in India
India is a key market in Škoda Auto’s internationalisation plans. Under the India 2.0 project, the Czech car manufacturer has been responsible for the Group’s activities on the subcontinent since 2019. The locally developed and produced India 2.0 models – the Kushaq and Slavia – have been very well received by Indian customers. The brand more than doubled its deliveries there in 2022 (128% over 2021). This made the highly dynamic market the carmaker’s third largest individual market in 2022.

Škoda Auto has a long-term plan and a clearly defined strategy for developing the Indian market further. One crucial aspect is localisation: A localisation rate of 95% ensures maximum market proximity. The Group’s investments in the region amount to one billion euros to date, of which 250 million euros flowed into research and development projects in India. Most of the technical development is carried out locally. In the long term, Škoda is targeting a combined market share of five per cent with the Volkswagen brand, depending on market and segment developments.

The company is advancing the India 2.0 project by exporting vehicles from India, thus gradually transforming India into an export hub. The Czech car manufacturer began exporting the Kushaq to the Gulf States in October 2022. This makes the Middle East the first export region for the brand’s made-in-India model.

Expansion across the Middle East
The brand is expanding its business in the Middle East, anticipating rapid growth in the region. To this end, the company joined the National Sales Company Audi Volkswagen Middle East (AVME) based in Dubai on 1 February. As the Czech car manufacturer’s first Managing Director in the region, Lukáš Honzák will be facilitating Škoda’s integration into the National Sales Company for the Audi and Volkswagen brands. Honzák is an accomplished sales professional and has many years of international experience in the areas of sales, marketing and developing the sales network.

The existing sales structure of AVME, which is represented throughout the Middle East, opens up additional growth opportunities. Škoda is currently active in four countries on the Arabian Peninsula: Bahrain, Kuwait, Qatar and the United Arab Emirates.

In the Middle East, Škoda Auto offers a wide variety of its European ICE models. Last year, the brand delivered a total of 1,200 vehicles to customers in the region. Through its expansion initiative, the company aims to reach 5,000 deliveries a year. The Kushaq is expected to account for more than half of future sales. Looking ahead, Škoda also intends to offer electric vehicles in the Middle East.

Škoda’s comprehensive corporate and production strategy also incentivizes dealers in the region to push ahead with their sales activities. Considering the expected increases in sales, they are investing heavily in their showrooms. Dubai is currently home to one of the brand’s largest dealerships in the world. Additional showrooms are planned for Kuwait and Abu Dhabi in the near future.