Is the Czech manufacturer looking for a new strategic partner?

In March this year, Skoda and Tata announced a “long-term strategic cooperation in clearly-defined fields.” However, only five months later, the partnership was cancelled because “neither the technical nor the economic synergies are achievable to the extent desired by both parties.”

Simply said, the Czech manufacturer wanted to use the help of its Indian partner and to launch budget cars for the local market. Apparently, despite the cancellation of the cooperation talks, Skoda is poised to produce low-cost vehicles for emerging markets starting by the end of the decade.

More on the cancelled Skoda-Tata collaboration:

Volkswagen Group’s head of strategy Thomas Sedran has confirmed to Automotive News that Skoda is interested in continuing what it has already started. “A series of ideas” for a cheap car have already been developed – a model for the Indian market that could be used also for Brazil and Iran.

Skoda and Tata reportedly decided not to continue further cooperation talks because the Czech company denied the idea of developing a budget car on Tata’s AMP platform. According to sources close to the matter, quoted by Automotive News, the manufacturer feared the architecture would need significant investments to meet future safety and emissions requirements.

Skoda Fabia milestone production
Skoda Fabia milestone production

Volkswagen Group’s intentions to create a budget brand date back to 2012. More recent reports indicated the German company wants to launch a small sedan and a midsize SUV with the most affordable of them wearing a starting price of about $10,000.

In February this year it was reported Volkswagen is looking for a Chinese partner to work on the project. Initial details suggested the first production low-cost cars could be based on the old PQ35 platform borrowing some technologies from the modern MQB modular architecture.

Note: Skoda Fabia production pictured.

Source: Automotive News

Gallery: Skoda Fabia milestone production

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