India 2.0 Project drives Skoda Auto Volkswagen to a record turnover of $1.66 billion in FY22

The European major which posted over 80 percent growth in output is on course to breach one lakh cumulative sales and 2.5 percent group market share.

By Ketan Thakkar calendar 22 Nov 2022 Views icon12304 Views Share - Share to Facebook Share to Twitter Share to LinkedIn Share to Whatsapp
India 2.0 Project drives Skoda Auto Volkswagen to a record turnover of $1.66 billion in FY22

Skoda Auto Volkswagen India has posted its highest ever revenues for the fiscal year 2022 at Rs 13,839 crore or 1.66 billion dollars led by the new product onslaught across all its brands led by India 2.0 localised product action for Skoda and Volkswagen brand.

The total revenues for the European auto major jumped over 58 percent in the previous financial year. This growth in revenues was due to an increase in sales volumes in domestic and export markets.

Skoda Auto Volkswagen India had posted an 85 percent rise in production at its factory with an output of 1.12 lakh in FY22. The Group sales was about 68,000 units in the last financial year, which is set to cross one lakh units in the current year.

The European automotive conglomerate closed FY22 with a market share of two percent, which may increase to 2.5 percent in the current financial year, with improved supplies and full year model availability of model 2.0 products.

The company’s operating profit also increased from Rs 288 crore to Rs 298.44 crore in the current year due to the new models launched under India 2.0 project in FY22, the company stated in its annual filings to the Ministry of Corporate Affairs.

The net profit however slipped to Rs 208 crore for FY22 on higher cost and supply chain disruption versus Rs 773 crore profits it reported in FY21.

Pandemic Problems
Reviewing the financial year 2021-2022, the directors report stated that the novel coronavirus pandemic came at a time when the automotive industry was hoping for a recovery in this financial year. “It impacted us and all the stakeholders in the value chain who experienced shortage of raw material, liquidity crunch, delays in availability of models, deferred launches and shrinkage in consumer demand,” the note said.

On its part, Skoda Auto Volkswagen management implemented business continuity planning by setting up an instant response team, contingency measures for availability of essential components, prioritisation of supply chain capacity, ensuring real-time monitoring and response management and other measures for mitigating the uncertainty caused on account of pandemic.

“Whilst following the stipulated norms we did manage to run the production in both our plants with minimal interruptions to the extent possible. Our sales and marketing teams also performed their best whilst working from home to a great extent,” added the statement.

The Board continues to work strenuously to further strengthen the financial position of the company and have embarked upon various initiatives to improve sales, control costs and improve efficiency in all its operations, assured the management.

Year in Recap for VW Group brands

For the Czech carmaker, FY22 was a “landmark year” in history, the group management said.

The company launched four products viz. the all-new India 2.0 project cars KUSHAQ and SLAVIA, the fifth-generation OCTAVIA and the KODIAQ FL. The overall retail volumes grew 183 percent to 31,218 despite challenges from COVID-19 and semiconductor shortages, with March 2022 being the highest sales month ever.

Skoda’s network grew from 105 sales outlets to 155, whereas aftersales outlets grew from 62 to 102 with the newly introduced compact workshop format.

The management now feels it has built a “strong foundation” for brand ŠKODA to witness significantly stronger volumes in the coming years.

The Volkswagen brand made strides in refreshing its product portfolio and dealer network in the financial year 2021-22. During the year, the company introduced the all-new SUV Taigun and premiered its mid-size sedan Virtus.

The company renewed its brand identity with the implementation of the global 'new brand design' which it claims is more vibrant and it is accessible across 150 sales and service touchpoints across the country. 

The company's premium brand Audi India clocked year on year retail growth of 98 percent in 2021 as compared to previous calendar year. During the year under review the group launched Audi Q7 and it followed up with the launch of Audi A8 L in July.

With strong commitment towards electrification and sustainability, Audi India became the only manufacturer to launch five electric cars in the year 2021. [Audi e-tron 50, Audi e-tron 55, Audi e-tron Sportback 55, Audi e-tron GT, Audi RS e-tron GT]

The company is now focused on creating a complete ecosystem across sales, after sales, buy-back, charging and overall ownership of electric cars.

The group's most profitable global brand Porsche too recorded a strong sales performance, marking a 46 per cent increase over FY21, supported by a solid retail result in the second half of 2021.

Porsche’s first fully electric sports car, the Taycan, was introduced to the Indian market in the last financial year along with seven new model additions.

Furthermore, Porsche India appointed three new Porsche partners in Mumbai, Bangalore and Chennai increasing the number of sales locations across the country to eight.

For the Italian sports car maker, the year 2021 was yet another record year for the brand with the growth of 86 percent in 2020 and delivering 69 cars.

During the year Lamborghini also delivered the 100th Urus in India, thus achieving a new milestone of the fastest 100th car delivery across all models within the super luxury segment in India.

The company also launched the Urus Pearl Capsule in March and Urus Graphite Capsule in August this year, followed by the Huracán EVO Spyder in May and the Huracán STO in July.

“With this sales performance in 2021 and a strong order book position across the product portfolio, we are confident that 2022 will be another year of excellent growth for Lamborghini cars,” the management's note added.

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