Czech car brand Skoda has undergone a complete reinvention since its acquisition by Volkswagen Group in 1991. Because of its Eastern European heritage it retained a reputation for several years as a lower quality brand, but the group has worked hard to overturn those preconceptions. Indeed a key element of the brand's marketing in other European markets since the 1990s has been a mocking acknowledgement of those misconceptions. The brand's lower cost manufacturing base in the Czech Republic enables pricing to be kept low, allowing Skoda to be presented as value for money brand. Marketing has concentrated for several years on emphasising the brand's high quality despite its low cost. The "Simply Clever" slogan has been used since 2008 in keeping with that positioning of smart understatement. The range is split between smaller cars like the Fabia and Rapid, the biggest sellers in Eastern Europe, and the high quality Octavia sedan, the flagship model in Western markets, with newer sporty SUVs like the Yeti/Karoq. These are complemented by a top of the range limousine, the Superb. Deliveries topped 1m units for the first time in 2014 and reached a new high in 2018 of 1.25m units. The Octavia alone accounted for 400k units, making it the single biggest non-VW model within the Volkswagen Group's whole portfolio; it was followed by the Rapid and Fabia, at 191k apiece. The Skoda brand continues to dominate the comparatively small Czech car market, with almost a full third of local market share, three times the sales of its nearest rival (which is sister brand VW). However, China is now Skoda's single biggest market by sales, accounting for more than a quarter of volumes (341k cars). The Kamiq is a new SUV designed specifically for the Chinese market. Germany is another major territory (177k), followed by the Czech Republic (94k) and Russia (81k). Divisional revenues for 2018 were €17.3bn, including sales of other group brands in the Czech Republic, with operating profit of €1.4bn. Bernhard Maier is divisional CEO. Skoda is in fact one of the world's oldest surviving automobile manufacturers, first established in 1895 as Laurin & Klement, before being acquired by the Skoda industrial conglomerate in 1925. It was nationalised by the Communist government after the Second World War, and then gradually privatised from 1991 onwards. Volkswagen initially acquired a 30% stake from the Czech government, and gradually increased its holding to full control over the course of the following five years.
Capsule checked 18th April 2019
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