VW Looking To Stop Skoda From Being So Damn Competitive

Skoda is apparently doing such a great job at making cars that some of VW’s managers and unions are now looking into ways to curb the competition from the Czech brand.

With VW currently struggling to cut jobs and spending at its German factories at the Dieselgate aftermath and Skoda posting superior profitability and more positive press coverage, the rivalry between the brands within the VW Group has been more intense than ever.

Reuters reports that VW wants to reduce what it sees as Skoda’s unfair advantages, meaning the combination of German technology with cheaper labour, by looking into moving some of the Czech brand’s production into Germany and force them to pay more for the shared technology they enjoy.

If this happens, it will reaffirm VW’s position as the top brand ahead of the planned influx of the new electric vehicles, according to the same sources.

Skoda managed to thrive under the 26 years of VW Group ownership, becoming one of the most successful mid-market car makers and even surpassing Audi’s operating profit margin last year.

VW is currently facing thousands of job cuts as management is looking to trim the fat at its German factories but the powerful domestic unions are looking at Skoda’s success and see both a threat and a potential lifeline.

VW’s unions are now demanding the transfer of some Skoda production to the underused German factories, aiming to offset the declining output of the Passat and the ageing Golf. At the same time they demand Skoda to pay higher royalties to use VW’s commonest platform, the MQB architecture.

PHOTO GALLERY

  • RDS Alphard

    Why does this sounds familiar? But instead of Skoda, it was Tatra?

  • Miknik

    Who would have thought that producing more or less identical (and identical looking) vehicles with different badges and charging less for some of them would hurt the sales of the more expensive ones?

    • Obsequious Lickspittle

      And not a great deal less by each growing day…

    • Vassilis

      I seriously can’t understand people that claim the vehicles look identical. They just don’t.

  • OdysseyTag

    Not sure if I can vouch for the sources but if this is indeed the truth, that’s both a hilarious and painful reality the group as a whole will have to deal with.

  • Marty

    Yes, let’s punish Škoda for the failed brand strategies of the VW Group.

    • LWOAP

      What could possibly go wrong? 😛

  • Tumbi Mtika

    Do they realize that this makes them look WORSE?

    • LWOAP

      Hmmm….nope. Self awareness seems to be in short supply these days.

  • CarCzarDesigner

    This is exactly what happened to Saturn. Other GM Divisions complained Saturn was too competitive and it was taking away sales. So GM handicapped Saturn and the miracle car to take on the Japanese, got uglier, wackier, quality control suffered and dismayed buyers stayed away or headed for the door. Then GM tried to bring Buyers back with new models. But it was the old story of; too little and too late.

    • Ilbirs

      We can even trace some parallels between Saturn and Skoda:

      1) Saturn was one division of a bloated GM, while Skoda is a division of a bloated VW Group;

      2) Both divisions made very creative models that can go head on head against competitors from less bureaucratic groups. In Saturn we had the SL, SC and SW with their plastic external panels preventing some minor damages while Skoda had the previous Superb (Twindoor being its greatest feature and making anyone with good sense discard an equivalent Passat), the Roomster and other ones, plus the fact of being the only Euro brand that has initial quality and long term dependability on levels that rival the Japanese brands (if there’s any doubt, just search the J.D. Power studies made in Europe);

      3) Both divisions are raising envy from other brands within the groups they belong because the envious one prefer to handicap the ones building better cars inside the house instead of themselves building better cars inside the not so efficient divisions following the nearby example of the ones doing right.

      We could even point the fact that both Saturn and Skoda released Green Line versions of their cars to put more coincidences, but I consider the three analogies sufficient to show us that brands in a supporting role aren’t allowed to be better than the leading ones inside the group if they sell entry-level cars.

    • gary4205

      Saturn was barely a car! It was mostly a pretend “touchy-feely” no haggle sales gimick.

      The billions upon billions wasted on Saturn sent GM into bankruptcy and saw them kill Oldsmobile….the oldest automobile brand in America. …and Pontiac….as well as Saturn itself!

      Saturn made exactly ONE exciting and compelling product. The Sky roadster. Of course Pontiac had the exact same car…with a different front end.

      $7 BILLION pissed away on Saturn.

  • Go, Škoda!

  • haudit

    So, instead of looking for constructive ways to improve Volkswagen’s profitability and reputation, they’re looking for ways to hobble Skoda’s competitiveness? That’s a deeply, deeply flawed strategy that will eventually damage the entire group.

    • Obsequious Lickspittle

      That’s Unions for ya.

  • rover10

    That horse has bolted, talk about cutting off your nose to spite your face! I don’t think I’ve ever heard anything so daft.

  • Six Thousand Times

    Typical Germans. Czechs are just better people than you are – just live with it.

    • LWOAP

      Live with it? Please. They be like “Ich bin noch nie so beleidigt worden.”

    • mike

      That’s a bit too much though. Technology is VW, Skoda’s would never be this good or cheap if Czechs had to develop engines and suspensions from scrach.

      • Six Thousand Times

        Just a little joke. Sorry you didn’t pick up on it – maybe the German in you? 😉

  • DOESN’T MAKE ANY SENSE.

  • exeptor

    I will not complain if they go back to the old strategy – previous gen technology, but I want
    cheaper Škoda-s with the current design, quality and internal space. This way these who want latest gen toys will pay the extra money for VW. But why I think that they will choose another direction which will not be a good one.

  • Can the Unions

    “VW’s unions are now demanding the transfer of some Skoda production to the underused German factories, aiming to offset the declining output of the Passat and the ageing Golf. At the same time they demand Skoda to pay higher royalties to use VW’s commonest platform, the MQB architecture.”

    Fuck the unions!

  • salamOOn

    Why would you obstruct your steady income to your financial profit?

    • gary4205

      Unions. A bunch of communist scum.

      Government sanctioned organized crime.

      The very notion that a worker is FORCED to pay money to a third party to have a job is immoral.

      That’s why most states in America are “Right to work” states, meaning unions are not welcome.

      It’s why all the “foreign” car companies build their factories in Texas and the South. No unions.

  • LWOAP

    *Golf Clap*

    Oh, yeah, that’s a real smart move. No way this is going to back fire. Nope, not at all. Keep going Skoda despite what your parent company is trying to do.

    • Andrew Riles

      Pun intended??

      • LWOAP

        Yes.

  • Thando_Gqabaza

    Trouble in paradise ?

  • Ilbirs

    Skoda is suffering this persecution due to be more efficient than the rest of VW Group. It builds better cars (see initial quality and long-term dependability studies from J.D. Power in Europe and will find that the Czech brand is the only Euro one that matches the levels found in leading Japanese brands of these rankings) and also cars that are more interesting and innovative than the ones from VW brand (a previous-gen Superb with its Twindoor is way more interesting than a Passat built on the same PQ46 architecture, for example). Even the design solutions of Skoda make these cars look more upscale than VW.
    This made Wolfsburg envious of the efficiency inside its headquarters and, instead of following the example and spread it across the rest of the brands, all we see is this people now wanting to dillute and handicap its best brand. What I see is just mediocre people complaining how about other inside the same house is making the things better instead. Looks like a family in which a narcissistic parent does all things possible for the relatives not thrive instead of see this as a good sign.

  • I’m no McKinsey consultant, but instead of moving Skoda production to Germany and raising expenses for the VW group, perhaps they should move VW production to the Czech republic and reduce expenses for the conglomerate.

    • Jan Mleziva

      Well, you forgot to put Unions into your equation…

  • Knotmyrealname

    Makes me want to go out and buy a Skoda.

  • alexxx

    not surprised at all…I already had a feeling that vw was making Skoda designs ugly on purpose, now I am pretty sure it was the case…. Didn’t help them, so now they had to invent something else

  • gary4205

    This is why unions should be run out on a rail.

    Union thugs tried to organize the VW plant in America. …twice.

    The workers said HELL NO!

  • Marc Gruben

    I’ve been saying for a long time that VW should bring Skoda to America. It seems Skoda is much more true to VW’s original premise than VW is nowadays. Skoda could revitalize VW in the U.S. I could see the Yeti being a smash hit here, and both the Octavia & Superb hatchbacks – since they look like traditional sedans – would do well.