With the growing interest in electric vehicles in India, leading car manufacturer Skoda plans to launch an electric vehicle by 2027 priced under Rs 10 lakhs.
Amidst rising demand for electric vehicles, Skoda has officially announced its plan to introduce a budget-friendly electric vehicle (EV) in India. The new electric car is expected to resemble the Kushaq SUV, and it's reported that the electric cars will be manufactured at Skoda's Aurangabad plant.
It monitors policy updates, particularly the upcoming CAFE 3 norms and the government's stance on EV and hybrid taxation, to greenlight production. Skoda is cautious about moving too quickly with the EV project.
Importance of localization
Skoda emphasizes that the competitive pricing for its budget EV can only be achieved through extensive localization.
By focusing on localized production, Skoda aims to control costs, making the EV accessible to a wider market segment.
However, the automaker has stated that the Indian EV market needs to grow considerably from its current size for localization efforts to truly pay off.
Skoda aims for deep localization, ensuring it can serve budget-conscious consumers without compromising on the quality of its EV.
India as Skoda's Priority Market
India is among Skoda's top-performing markets globally, and the company is not willing to take unnecessary risks.
Instead, it plans to wait and see how the EV market evolves, allowing other automakers to establish a strong demand base for electric vehicles.
Skoda is confident that a late entry won't be a disadvantage, as the brand believes the value proposition of its products will be competitive enough to capture a significant market share even with a delayed entry.
While Skoda's budget EV is expected after 2027, the brand will initially offer two premium offerings in the EV segment - the Enyaq EV and Elroq SUVs.
The Enyaq, slated for a facelift by March 2025, and the recently unveiled Elroq will initially be imported via the completely built unit (CBU) route.
Market trends and future outlook
The anticipated Kushaq-sized EV aligns with market trends, as Indians' tastes have gravitated towards purchasing larger cars.
By the time Skoda's budget EV is introduced, the Kushaq is likely to have two- or three-row options, positioning Skoda well to create an electric SUV with broader appeal.
Skoda competes with established players like Maruti Suzuki, Tata, Mahindra, Toyota, MG, Honda, Hyundai, and Kia, and is expected to compete in the mid-size EV market.
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