When do internal combustion engines end? We don’t know yet, Europe is not the whole world, says the head of Škoda Auto

In some European carmakers, including within the Volkswagen Group, there is a growing debate about whether – and if so when exactly – the development and sale of internal combustion engines should be stopped (read here). That such a debate is also taking place in Škoda Auto, its boss Thomas Schäfer confirms for Economic newspaper, although he is clearly prudent in this matter.

“We are in a transition period and it is difficult to predict something with certainty now. The world is not just Europe, where so much is being talked about about the end of internal combustion engine development. It is difficult to predict what will happen after 2030. In the future, we want to have more than 50 percent of electrified models on offer in Škoda Auto in 2030. But many customers around the world still want normal cars, and our role should be to meet this demand as well, “he added.

According to ČTK, the carmaker should probably introduce four electric models by 2030. In 2023 it will start producing a new generation of the Superb type, a year later the new SUV Kodiaq and Karoq will arrive.

According to Schäfer, it will be clearer in the second half of this decade. “This time will reveal the results of the work we are doing now. There will already be many electrified cars on the market, the cars we are launching right now will be at the peak of our life cycle and we will have a clearer idea of ​​where the world is heading. to organize plans with the development of our portfolio until 2030 and we will better prepare for the next decade, which will be, in my opinion, the most demanding, “he told HN Schäfer.

According to him, it is therefore realistic that in the distant future, although some factories in Europe will produce internal combustion cars, they will be sold in other, non-European markets.

Representatives of the Škoda carmaker stated at the annual conference that the company wants to invest 2.5 billion euros in new technologies. These should be used to modernize equipment so that the company undergoes a transformation that prepares it for a digital and electrified future.

“We have to emerge victorious from this battle. But investment will need to be made first. First and foremost, we need to focus on efficiency, not cosmetic adjustments. We will review spending, cut red tape and eliminate redundancies,” Schäfer added.

After all, the company introduced austerity measures last year, which helped it to radically reduce fixed costs by 550 million euros. Thanks to this, in the end, the company’s financial results were among the best within the group. For example, the carmaker Seat ended in a loss last year.

The results of Škoda Auto last year show that the carmaker’s revenues fell by 14 percent to 17 billion euros (424 billion crowns) and net profit fell by 52 percent to 15.2 billion crowns. Profitability fell to 4.4 percent (8.4 percent in 2019). “Last year posed difficult financial challenges. The cause was the coronavirus pandemic, declining sales, factory closures last spring and unfavorable exchange rate developments,” said Škoda Auto Chairman Thomas Schäfer at a press conference.

“The start of 2020 was very promising. In the second quarter, however, the company was hit hard by the effects of the coronavirus pandemic, while in the first quarter we reported an operating profit of 307 million euros, in the second quarter sales were halved and we lost 78 million euros. We took tough measures and consistent crisis management very quickly, and when production resumed at the end of spring, we achieved a slightly positive economic result in May, “said Klaus-Dieter Schürmann, CFO of Škoda Auto, at a press conference on the results.

According to him, an intensive working capital survey helped raise the company’s turnover in the second half of the year. It achieved a profit after tax for 2020 of 529 million euros. “The operating result after tax decreased, profitability also decreased, but as soon as circumstances return to normal, we believe that we will be able to raise profits again. We expect this year’s results to be better than last year’s,” added Thomas Auto Chairman of the Board of Škoda Auto.

A million cars delivered
Last year, Škoda produced 945,000 cars and delivered 1,004,800 cars to customers. Overall, production fell by 24.3 percent year on year. By far the largest decline was recorded in the Chinese market (-38.7 percent), followed by India (a 28 percent decline). In Russia alone, it showed an increase of 6.8 percent. At the same time, China remains Škoda’s largest market.

Last year, the Octavia was the best-selling model, with 247,400 cars sold, and the Fabia declining dramatically (by 39 percent). “We have long recorded the popularity of SUV models, one of the three Škoda cars sold is an SUV. We see a similar trend in China, where we sell the Kodiaq GT, an SUV with coupe lines. One of the three Kodiaqs sold in China is this model,” the new Martin Jahn, Member of the Board of Directors of Škoda Auto, responsible for sales and marketing.

Schäfer also indicated the carmaker’s plans for the coming years. “Škoda has greater competence within the Volkswagen Group, is responsible for the Russian market, the region of North Africa and relies on the region of Southeast Asia, the so-called ASEAN,” he added. He also reminded that the flagship Superb will be produced together with the sister Volkswagen Passat in the Bratislava factory from 2023.

“Škoda will continue to produce the Fabia Combi model, which should appeal especially to those for whom high utility value for reasonable money is important,” said Schäfer.

The official sale of the new Enyaq iV electric car will be launched in May this year. “We already have over 30,000 orders and we believe that customers will also reach the entire ecosystem of services, such as the Powerpass application, which will enable the use of charging stations within the pan-European network,” added Martin Jahn from the Škoda Auto Board of Directors. Škoda wants to produce 350 Enyaqs a day in the Mladá Boleslav factory.

At the annual press conference of the Škoda Board of Directors, he also reminded that he would like to have a factory for the production of batteries for electric cars in the Czech Republic. Some time ago, the Volkswagen Group directly informed about the plans to build six plants in Europe. “We would like one factory to be established in the Czech Republic,” added Schäfer.

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