Success Story: ŠKODA and Volkswagen Celebrate 25-Year Partnership

Success Story: ŠKODA and Volkswagen Celebrate 25-Year Partnership

14/04/2016
The foundations of an exemplary success story were laid 25 years ago. The partnership between the Volkswagen Group and the Czech carmaker began on 16 April 1991. From that point on, the traditional Czech brand evolved from being a regional market leader to an internationally successful vehicle manufacturer. In the presence of Czech Prime Minister Bohuslav Sobotka, Volkswagen CEO Matthias Müller and Jaroslav Povšík, head of trade union KOVO MB, ŠKODA CEO Bernhard Maier commemorated this outstanding milestone in the company’s 121-year history today. Around 500 guests from politics, economy and society took part in the anniversary celebrations at the Laurin & Klement Forum of the ŠKODA Museum in Mladá Boleslav.

Mladá Boleslav, 12 April 2016 – “ŠKODA is one of the longest-established carmakers in the world that has been writing an exemplary success story over the past quarter century thanks to a strong team,” said ŠKODA CEO Bernhard Maier, adding: “What began as a one-series producer with annual sales of 170,000 in the early 90s has since evolved into an internationally competitive car company with six model lines and over 40 versions. Nowadays, ŠKODA produces over one million cars per year at 14 production sites on two continents, selling products in over 100 markets. The good partnership between ŠKODA and Volkswagen and a competent and highly motivated workforce have paved the way for this exemplary development.”

“Supporting a stable economy, attracting new investments and creating new jobs are among the priorities of the government coalition. ŠKODA AUTO has become one of the drivers of the Czech economy over the past 25 years. The government recently supported the expansion of the Solnice-Kvasiny industrial zone in the Hradec Králové region. ŠKODA AUTO will be investing 7.2 billion crowns into the location and creating more than 2000 new jobs by 2018. This investment also underlines the fact that ŠKODA AUTO is one of the most important investors and employers in the Czech Republic. I wish the company stable and successful development over the coming years,” says Prime Minister Bohuslav Sobotka.

By 1990 several car manufacturers from Western Europe and overseas had expressed their interest in the traditional brand, founded in 1895, to the Czech government, who ultimately decided in favour of merging ŠKODA with Volkswagen. Europe's largest automobile producer was seeking a strategic partnership with the traditional Czech brand, and welcomed the highly trained, creative and efficient workforce. Craftsmanship and engineering expertise had always been among the Czechs’ strengths. On 28 March 1991, Czech Industry Minister Jan Vrba and Dr. Carl Hahn as CEO of Volkswagen signed the agreement on the inclusion of the then ‘ŠKODA automobilová akciová společnost’ in the Volkswagen Group. On April 16, 1991, the document came into force. As a result, the Group gradually increased its share before becoming the sole owner of the joint stock company ŠKODA AUTO on 30 May, 2000.

“ŠKODA and Volkswagen represent a European success story. 25 years ago, ŠKODA was a company with a long tradition and great potential. Today, ŠKODA is the Czech Republic’s leading exporter, and one of the most dynamic automotive brands in the world,” says Volkswagen Group CEO, Matthias Müller. “Digitization and electromobility are presenting our industry with considerable challenges, but above all, they offer great opportunities. As part of the Volkswagen Group, ŠKODA has all the prerequisites to cope with change, in terms of their customers, employees and manufacturing locations. This will involve not only redefining the car, but also our company to a large extent. And we will be doing that together.”

Since then, a comprehensive coordinated investment programme has fuelled the ŠKODA brand’s dynamic development. Between 1991 and March 2016, more than 300 billion crowns (around € 11 billion) were invested in new models, research and development, and in expanding production capacities. With approximately 28,500 employees today, ŠKODA is one of the largest and most attractive employers in the Czech Republic. The production network, including ŠKODA’s three Czech sites in Mladá Boleslav, Kvasiny and Vrchlabí, has grown in capacity thanks to Volkswagen Group affiliations in China, India, Russia and Slovakia, in addition to the assembly plants in Ukraine and Kazakhstan.

“With this 25th anniversary, ŠKODA and the Volkswagen Group have reached a new milestone along their joint path,” says Jaroslav Povšík, head of the union OS KOVO MB adding: “We can be very proud of our employees’ performance. Without them, the impressive success story of the past 25 years would have been unthinkable. It has once again been shown that the Community Decision model that Volkswagen has successfully implemented ensures both satisfaction and records.”

The heart of the globally successful brand still beats in Mladá Boleslav – one of the birthplaces of the European automotive industry. The company’s main plant and headquarters have been located in the Bohemian town for the company’s entire 121-year history. The carmaker’s pioneers include Václav Laurin and Václav Klement, who – impressed by motorized mobility on two and four wheels – laid the foundation for today’s automobile company in 1895. Incidentally, they were contemporaries of Ferdinand Porsche, whose birthplace, Vratislavice, is situated near Mladá Boleslav.

ŠKODA is now one of the fundamental pillars of the Czech economy: In 2015 the manufacturer contributed around 4.5% of the Czech gross domestic product, accounting for around 8% of Czech exports. The brand consistently sets new sales records: In 2015 deliveries increased by 1.8% to 1,055,500 vehicles (2014: 1,037,200). Revenue increased by 6.2% to a new record of € 12.5 billion (2014: € 11.8 billion), and operating profit grew by 12.0% to € 915 million (2014: € 817 million). By the end of March 2016, ŠKODA’s global sales had climbed by 4.3% to 276,600 vehicles, thereby reaching a new record for the first three months of a year.

A design sketch provides a first glimpse of the interior of the new ŠKODA SCALA. The new compact model will be the first ŠKODA to feature the latest infotainment generation with a free-standing display positioned high up, in the driver’s immediate field of vision. The optional Virtual Cockpit has the biggest display in its class. In addition to new interior trims and premium materials the SCALA also offers a generous amount of interior space, along with the largest luggage compartment in this segment, at 467 litres.
Following on from the first silhouette images, ŠKODA reveals the name of its new model – the ŠKODA SCALA. The name derives from the Latin word ‘SCALA’ which means ‘stairs’ and is a step forward for the Czech car manufacturer in the compact hatch segment. The SCALA is the first ŠKODA production model in Europe to carry the ŠKODA name in lettering across the centre of the tailgate and replaces the ŠKODA logo.
ŠKODA is introducing a new, fully programmable digital instrument panel to its KAROQ, OCTAVIA, SUPERB and KODIAQ ranges - giving the customers the option to replace traditional analogue dials and gauges with a high-definition electronic display for the first time.
ŠKODA AUTO continues on the road to success. From January to the end of September, the car manufacturer increased its worldwide deliveries to customers by 7.8% year-on-year to a new record of 939,100 vehicles. ŠKODA AUTO also achieved sales revenue of 12.6 billion euros, an increase of 2.1% and the best result in the company’s history. The operating profit of 1.1 billion euros remained high in the first three quarters, but was negatively influenced by high financial expenditures for new models, electromobility and higher personnel costs.
ŠKODA is releasing a silhouette picture to grant the public a first look at its future model for the popular compact class. It provides a first taste of the distinctive and dynamic design of this five-door model. This hatchback model translates the emotive design language of the study ŠKODA VISION RS, which recently attracted attention at the Paris Motor Show, into a production vehicle.

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Baking fever has once again gripped the nation – and ŠKODA UK is no exception. The car manufacturer has partnered with celebrity baker and 2016 Great British Bake Off winner Candice Brown to re-imagine a delicious, small-scale replica of the iconic Fabia cake. It comes more than a decade after ŠKODA’s advert, which saw a life-size version of the Fabia car made entirely out of cake.