Skoda to launch sub Rs.10 lakh SUV

Skoda Auto India part of the Volkswagen Group is planning to launch a mini-Sports Utility Vehicle (SUV) and price it below Rs. 10 lakh.

“The SUV segment is not growing as fast as was expected. We are looking to go down and are looking at a product priced below Rs.10 lakh,” Thomak Kuehl, Board member of Skoda Auto India was quoted as saying by the Business Standard.

Keuhl added that the company has a 25% market share in the D-segment with the Skoda Superb and 16.5% market share in the C+ segment in which the company offers the Skoda Laura sedan.

Currently, Skoda sells the Yeti diesel SUV priced between Rs 15.4 – 16.62 lakh (ex-showroom Delhi). The company sold around 900 Yetis in India since its launch in November 2010. The 5-seater SUV sold by the Czech car brand has a premium price tag has kept away many potential buyers who are looking for compact SUVs at around Rs. 10 lakh.

Kuehl mentioned that Skoda Auto India plans to launch a small diesel engine variant of the Yeti this year as well. The Skoda Yeti’s present model is powered by a 2.0-litre TDI diesel engine that makes 140 bhp of power at 4,200 rpm and returns an ARAI certified mileage of 17.67 km/litre.

Kuehl added that a petrol version of the Yeti is also on the cards. The launch of smaller diesel engine could help the company reduce the price substantially. The petrol variant too will be cheaper than the two diesel versions and will likely attract more buyers. Also read: Skoda Rapid sedan India launch soon

In the 2010-2011 fiscal year, roughly 3,24,000 SUVs were sold registering a 19% rise over the 2,72,000 SUVs sold in 2009-2010 fiscal year.

In the last four years, the SUV segment has been witnessing a steady growth of 15-20% every year. The No.1 utility vehicle maker in India, Mahindra & Mahindra sold around 1, 70,000 SUVs in 2010 which is more than half of the total SUVs sold in India last year.

Car makers are looking to develop sub-segments in the SUV category to draw in more sedan and hatchback car buyers from the upper middle-class who primarily demand affordable utilitarian vehicles. In the Indian market, the Premier Rio is the only compact SUV available priced around Rs. 5 lakh at present and has received a warm response despite the company’s lack of brand value.

Mahindra is planning to launch the mini-Xylo in the next couple of months at an expected price of Rs. 5 lakh. Related: Mahindra Mini Xylo production trial started

The sub-10 lakh SUV will help Skoda to set a strong foot hold in the booming SUV market. There are lot of chances that the upcoming Skoda small SUV to be powered by a diesel motor owing to the steep rise in petrol prices.