Skoda the baby hatch

Australia is about to get another car brand. The total is already running close to 50, with only four local manufacturers, but that is no deterrent to Skoda of the Czech Republic. The Volkswagen-owned manufacturer believes it can carve a place in the crowded local scene with unique designs and engineering, VW quality and a price position that will put it deep into the heartland of Japanese imports.

The starting point for its two opening efforts, the Roomster wagon and Octavia sedan and wagon, will be in the high $20,000 range with the Octavia topping out beyond $40,000.

Skoda sales will begin in October, following a preview at the Sydney motor show, and the company is aiming for about 2000 sales in its first year with 5000 as the mid-term goal once the product range and dealer network are expanded.

The Czech brand was last sold in Australia in the early 1960s, although some cars hit the road into the '70s, but Volkswagen Group Australia believes the time is right for a serious comeback.

“The brand is looking to expand from the Euro-focused markets, which you can see from the factory in China and another factory in India,” head of Skoda Australia, Mathew Wiesner, says.

“Australia is going to be a good test for a reasonably sized Western market. That could lead to other markets over time.

“We see a good position under the Volkswagen brand that VW doesn't really reach into. We can position Skoda amongst the Asian brands. Skoda's job is to sit in among them and grow.

“If you look at the group brands, it makes sense as you move through Skoda, VW and then Audi. We need to make sure we don't miss out as the Australian market grows and matures.”

Volkswagen is spending more than $5million on its Skoda push, but is taking things easy with five front-line staff and 14 to 15 dealers.

It will use the Czech company's Simply Clever kicker line but is looking at innovative advertising and promotional programs including the internet.

The most important element of Skoda's Australian effort is not confirmed. It is the Fabia, a baby hatchback that should become the brand's best seller here. The Fabia was launched in Europe this year with the Combi wagon to come later, which has delayed a deal for local sales.

Skoda Australia is pushing for a starting price in the sub-$17,000 range to give it the best chance of sales success.

“We do not have the volumes available,” Wiesner says. “It has something to do with the price and the segment structure in Australia.

“Maybe the Fabia Combi is more appropriate to the Australian market.”

The Fabia is a sellout in Europe and Wiesner wants the glut to clear, at least a little, before he gets into serious negotiations on the local plan.

There could be an opportunity for more volume once the Fabia goes into production in India.

“It is one of the opportunities, but would only be an opportunity from 2010 onwards,” he says.

Skoda would like to have the Fabia in Australia by 2009, once it has laid the foundations for the brand with the cute little Roomster wagon and the larger Octavia.

Further into the future, it is banking on a small four-wheel-drive called the Yeti and a full line of cars up to the Superb flagship, which will be revealed later this year.

First on-road impressions of the new-age Skodas are good. The Octavia is solid and gets an edge with the RS package, while the Roomster is an innovative baby wagon that could be a sleeper for the brand.

Once the Roomster hits Australia, and people see something different, sales could zoom.

Everything depends on the prices and how the value equations work, particularly against the Japanese cars which Skoda Australia has set as the brand's targets.

Two days of varied driving showed the basics are good and Skoda has put enough of a Czech twist into the cars to create a point of difference.

The Octavia is based on the VW Jetta with a roomier cabin as well as a giant liftback tail on the sedan, which gives good luggage space and excellent flexibility. The wagon is just a wagon.

The Octavia gets along best with the turbodiesel engine. The RS is a sharp drive with taut suspension and the Golf GTi turbo-petrol motor.

There were some minor quality niggles, with fitting errors and some cabin squeaks and rattles, but a range of cars drove nicely.

The Roomster is innovative, from its giant windscreen to the step-down side glass — better vision for youngsters — to back-row seats that can be lifted out and twin carry handles in the tail.

Snapshot

Likely Skoda model plans

2007: Roomster and Octavia 2

2008: Octavia Scout wagon, Fabia

2009: Fabia combi, Superb

2010: Yeti four-wheel-drive