For Petr Janeba, December 2 is “the day of judgment” for Skoda Auto India when bookings open for its sub-4 metre Kylaq SUV.
As Brand Director, he has been an active part of the journey for this new offering which the Czech carmaker is hoping will create the much awaited turnaround in the competitive Indian market. “After all the stories we have created for Kylaq since February, we are now entering the next milestone,” Janeba told ET Auto in a telephone interview.
He reiterated that that the entire exercise also reflected an important statement of trust from the group to communicate the Kylaq story through a near complete year before its launch. “We are now at the bookings stage where people will find the full price list and the different versions. I hope they like it and embrace it,” said Janeba.
The Kylaq will come in four options: Classic, Signature, Signature+ and Prestige with prices starting from INR 7.89 lakh for the Classic to INR 14.4 lakh for the automatic version of the Prestige. Except for the Classic which only comes with a manual transmission, the other three versions have an automatic option too.
The first 33,333 customers will get a complimentary three-year standard maintenance package which is expected to bring costs down to barely 24 paise per kilometre. The SUV has also received over 160,000 expressions of interest thus far.
Exceeding expectations
“People have been asking questions about Kylaq at dealerships and this has surpassed our expectations. We want to promote only 33,333 cars which is a special number because it is 100,000 when multiplied by 3. It is the ultimate maximum potential capacity with all the adjustments,” explained Janeba.
It is only on January 27 next year when all dealers will be ready to showcase the Kylaq at their showrooms and get ready for customers, demo cars for test drives. For now, as he put, it is “more or less a digital story” which is expected to create the momentum.
With Kylaq being part of the biggest user segment in India (the sub-4 metre SUV), Skoda is keen on offering those customers booking the product a very special value proposition in the form of a free maintenance package. “Skoda is perceived as European and an expensive brand for maintenance. This is true for imported cars but not for the Kushaq and Slavia whose drivers are the only ones aware of this reality,” said Janeba.
Kushaq, in particular, has a high degree of localisation and is more affordable as a result with its costs of maintenance comparable with some of the biggest selling brands in the Indian market. The free package for Kylaq, likewise, is an “unmatched benefit” which should convince people that cost of ownership is not an issue “by far” though it will only be applicable to the 33,333 buyers who choose to book online.
“Let us also see now many of these 160,000 people who expressed interest come in for bookings and how many new customers are keen on a new sub-4 metre SUV,” said Janeba. The basket on offer will see a varied mix of the four versions with perhaps the entry-level taking up the least share.
Taking on competition
“It is a limited offer and those who trust the brand will get a benefit in the pricing and maintenance package as well as getting European technology at an affordable price. We are 100% on a par with competition on pricing,” said Janeba.
Skoda Auto has also gleaned from market research that some metro plus markets are 85-90% automatic but for Tier 2/3 cities — “where we will have more touch points at over 100” — it is 90% manual. Right now, the company has a stronger presence in these metro plus centres but but will be more flexible in expanding its presence going forward.
With only one powerful performance engine (the 1.0 litre TSI) on offer for Kylaq, it is a “straightforward” deal for a customer which will hopefully make the entire buying exercise a breeze both for him and the dealer. “It will avoid too much confusion and we wanted to make everything easy while offering a good value proposition,” he added.
Dealers are “very enthusiastic” but Skoda believes that they need to focus on selling the existing range comprising Kushaq and Slavia too since Kylaq will be in their showrooms only next year. “They should also be ready to support and handhold potential customers. We need to be able to deliver on what they want without a car available and no touch/feel,” said Janeba.
Kushaq vs Kylaq
Production of Kylaq will begin at the Chakan plant of Skoda Auto Volkswagen India near Pune in December and the first batch will come off the line in January. Skoda will also launch a completely new retail plan shortly where the focus will be on communicating a value proposition specifically created for Kushaq. This is because it is more than likely that its demand will be impacted with the introduction of the more competitively priced Kylaq.
“There is no problem for those who buy the 1.5 TSI version of Kushaq because it is not present in Kylaq and the only issue is for those 70% who buy the 1.0 TSI where there is a clear split and the price difference is very visible,” said Janeba. Clearly, there will be some levels of cannibalisation and it now remains to be seen how intense this will end up becoming through 2025.
Skoda has also observed that rural regions are growing by 15-35% compared to big metros which are even seeing de-growth. The situation has been particularly “shaky” this year and the carmaker is, therefore, gearing up to increase its retail presence at regional levels in Tier 2/3 centres. “Skoda will be closer to customers here than ever before,” declared Janeba.
