Europe’s quirkiest brand, Skoda, has kept its sales steady this year in the shrinking passenger segment with a range of brand-building exercises that has seen it differentiate itself from parent company Volkswagen and offer an alternative to those seeking an aspirational Japanese brand.
Speaking to CarAdvice at the launch of the new Octavia RS230 in Sydney yesterday (review), the head of the Skoda brand in Australia, Michael Irmer, said he is now seeing the Skoda brand image coming to the same levels as its direct rivals.
“The brand image itself, the qualitative element of it, we see it consistently rising and it’s starting now to come into the territory of some of our competitors we have in our basket," he said.
Although Irmer wouldn’t be drawn into revealing the brands Skoda is going after, his comments suggested Mazda, Honda and Subaru are the key targets.
“The right competitors for us to look at are the aspirational Japanese brands, not the mainstream Japanese brands… [those] talking to someone who is not ready for luxury but not ready to buy barebones-based [either], that’s what we see for our buyers.”
As for the natural comparison to Volkswagen, Irmer admitted that it happens frequently.
“We are always going to be compared to VW, because people do know that, underneath, the product is very common when it comes down to engine and stuff like that.”
So why should buyers in Australia pick a Skoda over a Volkswagen? Irmer believes that while overlap will always exist, they are ultimately two different buyer groups.
“What we see is that obviously VW has Skoda for a reason and it has multiple brands as you know addressing different customers groups. Skoda is not in the market to compete with VW but in the market to go into areas where VW is not.
“Obviously that means we are capturing another side of the spectrum, but we are also trying to go a little differently.
"VW is always going to be a volume brand with a certain premium [feeling and price] associated to that, and Skoda can differ slightly from that - but it gives a whole host of other capabilities to the vehicles like the whole space and simply clever features, and that is really a point of difference," Irmer said.
The majority of Skoda buyers are new to the Volkswagen Group and come from existing Japanese brands, according to Irmer.
Skoda sales so far this year have kept steady at around 4000 units year-to-date, down 2.6 percent compared to this time last year. But, considering the passenger segment in Australia (Skoda’s only current segment) is down 6 percent, the brand’s market share has actually grown.