Skoda Posts Best Results in Europe

European car manufactures had a trying year in 2024, but no one seems to have told Skoda. The Czech OEM, part of the Volkswagen Group, posted entirely positive results this week, results that would have made any OEM CEO very happy even in the heydays of the 2010s.

Skoda managed not only to increase deliveries by 6.9%, but miraculously convert that healthy increase to an astounding 30% increase in operating profit! A somewhat more grounded 4.7% increase in sales revenue indicates that the profit is coming from a huge reduction in production costs, a huge increase in operating efficiency and clearing out dealer stock built in the previous year.

The highlight of the results however, is the margin Skoda has generated. At 8.3% they can comfortably claim to be the most profitable-per-vehicle manufacturer outside of Asia. The philosophy of giving customers what they want (namely value for money, well-engineered cars and choices in powertrain) Skoda is in full control of its public image and its future.

Historically, Skoda was the budget-brand of the VW Group, its Soviet roots clinging on in the eyes of the Western world. Now though, Skoda is a respectable, viable option for anyone not handicapped by badge snobbery. Indeed, this history now appears to be the secret weapon to success.

Skoda, unlike the big brothers of Volkswagen, Audi and SEAT, is not burdened with huge R&D commitments, deeply engrained in EV development. Instead, they are fortunate enough to inherit platforms and technologies from the Group, leveraging the German engineering outlay to offer re-badged and re-bodied cars to their customer base.

What’s more, and despite working hard to improve brand image, Skoda is still positioned as the “cheap” VW Group option in the eyes of many a consumer. The Volkswagen Golf starts from £27,760 in the UK. The cheapest Audi A3 starts at £30,100.

And Skoda? Well a Skoda Octavia, with its generous base equipment, substantial boot and discrete looks is £27,390. A £400 saving over the less practical, less spec’d Golf.

So, in these times of reducing disposable incomes, multi-car households and children that travel with more paraphernalia than an F1 Team, Skoda has become not only a viable choice, but the sensible one.