Skoda Auto Enters Vietnamese Market; Unveils Karoq & Kodiaq SUVs

Skoda Auto has taken an important step in its internationalisation strategy today with its entry into the Vietnamese market. An event took place with representatives of the Vietnamese and Czech governments alongside Skoda’s local distribution and production partner, TC Group.

Skoda Auto projects a rapid expansion of the dealer network to as many as 30 partners and an annual sales potential of over 40,000 units beyond 2030. The first models, starting with the Karoq and Kodiaq, will be imported from Europe. Local CKD production is planned to start next year. Skoda views Vietnam as a gateway to the ASEAN region.

Klaus Zellmer, Skoda Auto CEO, said “We are excited to engage with Vietnam’s dynamic economy and a new group of customers in this fast-growing market. This is also the next step in our accelerating internationalisation strategy, strengthening our brand in the ASEAN region and intensifying the synergies between our two key markets of India and Europe. During the preparations, it has been clear that in TC Group we have an excellent partner for the production and sale of our attractive model portfolio." 

Martin Jahn, Skoda Auto Board Member for Sales and Marketing, said: "Our medium-term plan is to engage around 30 local contractual partners, assemble around 30,000 cars from CKD kits, and realise a sales potential of more than 40,000 vehicles annually beyond 2030."

The Czech car manufacturer presented the Kvasiny-produced SUV model series Karoq and Kodiaq, which will be the first models available on the local market. Customers can purchase these at the first Skoda showroom in Hanoi from 25 September onwards. Additional showrooms in central and south Vietnam are in the pipeline. The goal is to expand the dealer network to 20 Skoda dealerships by 2025 and 30 by 2028. 

Skoda has a well-defined roadmap for the Vietnamese market, with plans to expand its model portfolio in response to customer preferences. The Octavia and Superb models are slated for importation to Vietnam in the medium term. Additionally, the all-electric Enyaq family is being introduced to cater to the growing demand for electric vehicles among Vietnamese consumers.

Starting in the second half of 2024, Skoda will be tapping into significant regional synergies. By then, the first Kushaq vehicles will have been exported from the Pune facility in India to Vietnam for assembly from CKD (Completely Knocked Down) kits, with the Slavia set to follow in 2025. Construction of a production line at the Viet Hung Industrial Park in Quang Ninh province by Skoda’s local partner TC Group is already underway. Based on market trends, there are ambitions to ramp up production, potentially assembling as many as 27,000 vehicles annually after 2027.

At present, Vietnam is the fourth strongest automotive market in Southeast Asia. Moreover, with only 38 vehicles per 1,000 inhabitants in a population of roughly 100 million people and given the anticipated national economic growth, Vietnam is emerging as the country with the highest growth potential in the region. 

The brand foresees annual sales of 30,000 units in the medium term, with that figure rising to more than 40,000 units after 2030. The capacity at the Viet Hung Industrial Park, where the TC Group-owned plant is located, could be used in the future to expand production with a view to potentially exporting Skoda models across the entire ASEAN region.