Skoda Auto Profile Skoda Auto is a multinational car manufacturer that is based in Czech Republic.

It operates in over a 100 markets world wide, including Ireland. Skoda Auto is a private company that has sold 684,226 vehicles (6 different models) in 2009, has had turnover of CZK 188billion in 2009 and has employed 26,153 workers in 2009 (Skoda Auto annual report 2009). It was set up in 1925 and produced bicycles, cars and planes in former Czechoslovakia. It overcame hard times during the next few decades such as World War 2, Wall Street Crash and other political changes. In 1990 Skoda Auto joined a partnership with Volkswagen AG (Automotive group) because the company needed investment to expand into Western Europe after the fall of the Soviet Union. Volkswagen AG is the sole shareholder and owner of Skoda Auto International, the parent company that owns all other associated companies like Skoda Auto Deutschland GmbH and Skoda Auto India Private Ltd. Aims, Mission Statement and Vision Skoda Auto s vision is to have the biggest market share in Europe and also a strong market presence in the rapidly growing Asian market by the year 2018 (Skoda Auto annual report 2009). They aim to do this by: Looking for extraordinary solutions to satisfy the transport need of customers. Being an environmentally friendly car company through their new green-line models. Having a record of total customer and employee satisfaction Being a car brand associated with good value to quality relationship Skoda Auto s Mission Statement To provide quality sales, service and transportation needs for our customers. This is and will be accomplished through a dedicated team of employees whose number one goal is customer satisfaction along with a management team whose responsibility is to ensure employee satisfaction, and customer enthusiasm. (new.skoda-auto.com) Organisational chart Skoda Auto has a typical organisational chart. Volkswagen AG is the sole shareholder of Skoda Auto. The company is run from the Czech Republic by the Board of Directors which is controlled by the Chairman of the Board of Directors, Reinhard Jung. Members of the Board of Directors each run a specific part of the business, eg purchasing or sales directors, or control a specific subordinate company that is owned in full either by Skoda Auto or Volkswagen AG, eg Skoda Auto India Private Ltd. The chart below shows in detail the whole structure of a subordinate Skoda Auto company, with the Chief Executive Officer being a member of the Board of Directors of Skoda Auto a.s. (the parent company) and the highest

commanding officer of the particular associated company. Skoda Auto s associated companies are as follows: Skoda Auto Deutschland, Skoda Auto India, Skoda Auto Slovensko, Skoda Auto Polska, Skoda Auto Nigeria, Skoda Auto Taiwan and OOO Volkswagen Group Russia.

SWOT Analysis of Skoda Auto Strengths The following section outlines the main strengths of Skoda Auto: Having an alliance with Volkswagen AG is a major plus point for Skoda Auto, this brings in new customers and makes business more effective through the strong brand name, expertise and marketing of Volkswagen. Skoda Auto takes advantage of the strong market presence and distribution network of Volkswagen to help them access new markets easily. Competitive pricing is a vital element of Skoda Auto s overall success, as this keeps the company above their rivals in the medium-cheap price car range. Keeping costs lower than their competitors by using the already established technologies from Volkswagen helps Skoda Auto pass on some of the benefits to its consumers, like giving better quality products at lower prices than competitors. New Green-line models are efficient, competitive and appeal to the eco-friendly market. Weaknesses This section presents the main weaknesses of Skoda Auto: Skoda Auto s vehicles have a reputation from the company s past of being cheap, badly built/designed and out-of-date cars. Skoda Auto has very little online presence, which is vital for modern businesses. The weak brand name compromises success for Skoda Auto as it doesn't inspire people to buy their cars. The weak brand name arises from the company s Eastern European origins, bad reputation and the lack of prestige in the mid/low-market range of cars that Skoda Auto optimises in. A limited customer base is a major weakness for Skoda Auto as it means they have less people to sell or market to. The weak market position of Skoda Auto means that it is behind its competitors with a low share of the market (1.7% UK), which in turn leads to lower turnover.

Opportunities

These are the opportunities that Skoda Auto is currently facing: Skoda Auto could benefit from Governmental support, in the form of the scrapping schemes that would apply to the Green-line models and make them very good value for money. Changes in technology; like new, more efficient/hybrid engines etc; could give Skoda Auto an opportunity to bolster future success. The changes in the way consumers spend and what they buy provides opportunities for Skoda Auto, as the recession makes people look for cheaper and more economical cars in order to save money. Grasping the opportunity to expand the customer base is something Skoda Auto can aim for, either geographically or through new products. Threats The threats Skoda Auto is currently facing are: Tax increases (raised VAT, new Carbon Tax) place additional financial burdens on Skoda. New products/services from rival firms (small, cheap and efficient cars eg Fiat Punto/Toyota Yaris vs. Skoda Fabia/Roomster) lead to Skoda cars being less in demand. The current slow growth of car sales is a threat to Skoda Auto. Price wars between competitors and price cuts could damage profits for Skoda Auto by forcing Skoda Auto to compete and drop prices. The slow economy of the recession is significantly lowering sales and profit of every car manufacturer, including Skoda.