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Old 25th November 2009, 13:05   #1
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Default 1997- A big blunder from Skoda Auto

In the year of 1997 Skoda Motor promised that they would come in Indian market with their Luxury car Octavia just for Rs.6 Lakh.Otherwise they would not enter in Indian market. At that time I have made up my mind that my next car would be definitely a Skoda Octavia, but all knows that it never happened and Skoda had broke my dream of owning that car.
Here are some old memories..
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Old 25th November 2009, 13:19   #2
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If they followed this pricing, they would have not beenin a dilemma with the corresponding VW models. Even if they pricing was about a lakh more, it would have still been okay.
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Old 25th November 2009, 13:20   #3
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What was the launch price of the Octavia in India ?
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Old 25th November 2009, 13:28   #4
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Haahh. I was under impression that SKODA A.S.S was deteriorated in recent years(Came to know through T-Bhp.)
This shows that they are into business of giving false statements before the launch in India. Its really our BAD to have faith in them in giving good business.

hiren959:Thanks for digging out this copy of magazine.

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Old 25th November 2009, 13:31   #5
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Quote:
Originally Posted by jigbarai View Post
What was the launch price of the Octavia in India ?
If memory serves me correctly I think it was a little over Rs. 10 Lacs.
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Old 25th November 2009, 13:33   #6
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It is very diffucult to price such a car @ 6 lakhs. But I get the sense of your post. When Octavia was introduced, it retailed around 10 lakhs both for petrol and diesel versions. There is not much competition in c+ segment in India and they sensed the opportunity and gradually moved up the value chain with new Octavia (Laura).

Same is the case with Honda. When they introudced Second Generation Honda City it was priced at lower levels than out going model. Further even Accord and CRV was priced at about 15 lakhs level when first introduced. Newer generation models of honda are priced at unresonably high levels.

I guess introduction of new players will correct the price abnormality.
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Old 25th November 2009, 13:47   #7
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Ever heard of something called time value of money? The value of 6 lakh in 97 will be a lot more than what its worth now. I'd say, even though the amount has changed, 10L now is more or less equal to 6L in 97.
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Old 25th November 2009, 14:32   #8
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Quote:
Originally Posted by JayD View Post
Ever heard of something called time value of money? The value of 6 lakh in 97 will be a lot more than what its worth now. I'd say, even though the amount has changed, 10L now is more or less equal to 6L in 97.
I guess the point being made is that in Feb 1997 it was declared that it will be launched at 6 lakhs, but it was instead launched in the same year at about 10 lakhs... So the time value of money calculation doesn't apply here
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Old 25th November 2009, 14:35   #9
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@ JayD still 6L in 97 is not equivalent to 10L in 2001-2002.

was this 6L pricing ever announced by any official skoda spokesperson in public?

Last edited by indian21r : 25th November 2009 at 14:47.
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Old 25th November 2009, 14:36   #10
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Quote:
Originally Posted by JayD View Post
Ever heard of something called time value of money? The value of 6 lakh in 97 will be a lot more than what its worth now. I'd say, even though the amount has changed, 10L now is more or less equal to 6L in 97.
True, but in the car market it has remained fairly constant, in fact probably prices have even reduced with competition.

For example if a Ford Escort was sold at 8 Lakhs, equivalent Fiesta is also sold around same or less. The price of Zen then was not too far off from the Ritz now and so on.

Quote:
In the year of 1997 Skoda Motor promised that they would come in Indian market with their Luxury car Octavia just for Rs.6 Lakh.Otherwise they would not enter in Indian market
6 Lakhs must be the service cost to keep a Skoda platform up and running for 4-5 years
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Old 25th November 2009, 14:39   #11
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They may have intended to price it at 6 Lakhs ( bill it to their counterpart at around similar price). The govt. taxes on CKD is also very high. So, I guess there is not too much of price difference as per them. May be they can still price it at these levels if they could manufacture it here in India.
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Old 25th November 2009, 16:54   #12
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I think the 6 laks Skoda claimed was excluding govt taxes and duties. So including that it would cost around 12 laks max.
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Old 25th November 2009, 17:14   #13
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in 1998, the indica was launched with the DLE version available at 3.3L. a 2009 indica DLE still costs about the same
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Old 25th November 2009, 18:20   #14
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The Octy can hardly be called a blunder. Its one of the most popular cars in India. Obviously, they cannot sell it at 6 lakhs. I dunno what made them say it could be done, but they miscalculated. By launchtime, they got the pricing spot on and it ended up being a big hit in India. It really isn't even remotely a 'blunder'.
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Old 26th November 2009, 00:49   #15
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I've noticed that a lot of people on this forum, as well asmost car magazines and tv shows are overly optimistic when it comes to guessing prices of upcoming launches. Anybody who expected the Octavia to be sold at 6L even in 1997 neede to be woken up from their daydreams. Similarly, people today expecting the latestgeneration Mitsubishi Lancer to be priced below 10L, or the upcoming VW Polo to be pricedat 4.5L are simply delusional. After making a car, paying all sorts of taxes and duties, it's impossible for manufacturers to sell cars at such absurly low prices and still make a profit.

The worst part is that manufacturers take note of all these unreasonable pricing expectations and launch cheapened versions of their cars in India. Those of us who want high quality cars and are willing topay the appropriate price are thn left to choose between small, low quality cars or the few large, high quality boats like the Accor or Superb.

I wish I could buy a VW Golf for 16L, or a Lancer for Rs 18L. But absurd price expectations often lead to dumbed down cars or previous
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