TOPGEAR.COM → JULY 2019 027
manufacturing companies and up their batter y capacity.
When volumes go up, price will come down.”
Strangely, he also sees a surge in CNG usage in India and
says Skoda will be ready for that.
“You might actually see the increase in CNG, you might
have seen the government increase CNG’s network, as well.
You can check the numbers. There is a substantial increase.”
While CNG is currently the fuel of choice for last mile
commercial passengers, Zac thinks fleet owners would
embrace it and Skoda will be there to take advantage
of that. Interestingly, he doesn’t feel “fleet” will erode
brand value.
“Fleet is not a dirty word. Fleet is not just taxis.
We have talked to a lot of fleet operators of various
hotels and all. This is where they want the leg room, the
luxury, the carrying capacity - cars like Octavia. Fleet
will grow in India as well. I think the self-drive business
will increase too.”
As we wrap up, I end with one last all-encompassing
question as to what is his immediate agenda for Skoda in
India given the much-hyped India 2. 0 project that is touted
as the gamechanger for the group for India. Amazingly, and
thankfully, he is quick to list them out.
“I will talk about the next two years - there are four key
things. First, increase awareness in the areas that we don’t
have dealers. Second, to increase our network’s footprint.
Third, to have a used-car programme in place. And last but
not the least, to continue to reduce the cost of ownership.”
Easier said than done, of course, but Hollis thinks that
what will make the brand tick is when it too is once again
perceived as “value luxury” like its products. And he knows
ball is in his court. Let’s wait and watch.2. 0 SUV and the Kodiaq, so it would be somewhere close to
the Octavia. So that is what we are working on. I want more
products, in terms of car composition without a doubt.”
The two major challenges that Skoda has traditionally
faced in India is its network and ownership costs. The latter
is baggage that comes with any premium aspirational brand.
Like many of his predecessors, Zac does feel Skoda has put in
place measures to tackle both.
“We are currently present in 54 sectors in India. At the
moment, these dealers are profitable with the current product
portfolio. As we move for ward to the India 2. 0 products with
two new vehicles to start with, we have a requirement to be
located in more cities and have more reach and to touch more
customers in India. So, we will go from 54 - 100 cities. That is
the plan in the next two years.
We get feedback to reduce the cost of ownership and the
first thing we have done is reduce the cost of our parts. In
the last two years we have reduced our parts’ prices by 30
per cent. Last year, we also launched four-year warranty – an
industry first. Customers can also buy an additional two-year
warranty, which makes it a six-year warranty. Our ser vice
inter vals are one year/15,000km and not six months like many
other car makers so at the end ownership, prices are on par.
With the Superb we have also started a unique buy-back offer,
something we will take to other models in the near future too.”
It is not surprising that many driving enthusiasts end
up with second-hand Skoda cars. Strangely, Skoda is yet to
venture into that business in India.
“Used cars is something we have completely neglected
as a brand. Pretty much ever y car manufacturer has a used
car platform. We don’t have that. We will launch it next year
because it makes so much sense. It is not only about having
accessibility of the brand for better value, it is also a good
business proposition for the dealers.”
Speaking of the future, Skoda will of course tap the electric
market but not as much as hybrid, is Zac’s personal view. But
the proper arrival of electric cars in India will have to be
government-driven programme, he feels.
“It is not about whether India is a conservative
market, it is about the government. If you look
at Chinese cities such as Shanghai, you have to
pay a lot of money for the number plate plus
wait for as much as 18 months to get the car. If
you take an electric car, you get it immediately.
And pay less taxes. So if it has to move quickly
in India, it has to be taken up by the government.
They have to lay out a clear plan structure, about
charging points which is the biggest thing and then
the manufacturers can bring the cars to India. Once
a car has 500 km of range, the barrier to charge is gone.
Currently, the customer is worried about range anxiety, the
battery charges... initial purchase price is quite high thanks to
battery costs. Car manufacturers will have to set up battery“The future is electric. But proper
arrival of EVs in India would have to be
a government-driven programme”