Just in the days when Volkswagen and Porsche, brands of the same German Group, are licking their wounds left by a particularly difficult 2025 – and many of these difficulties are due to losing ground in China – studying countermeasures to get their finances back on track (cuts and layoffs), a new signal arrives that allows us to grasp the seriousness of the situation: after 20 years Skoda, also controlled by Wolfsburg, has decided to leave the Chinese market.
IN CHINA FOR CHINA BUT WITHOUT SKODA
As is well known, Volkswagen is trying to recover some of the ground lost to local brands with a more aggressive strategy that responds to the slogan “In China for China”: Wolfsburg has defined it as “an important product offensive” which apparently will not include the Bohemian brand in the German Group’s portfolio.
Skoda had been in China since 2006: it debuted with the Octavia model produced within the joint venture between Volkswagen and the local Saic. In a short time, helped by the low cost of the cars on the list, China became the company from Mladá Boleslav’s main foreign reference market.
FROM 340,000 VEHICLES TO JUST 15,000
The boom year was 2018, with over 340,000 registrations that had pushed Volkswagen to grant particular freedom of action to the subsidiary through the opening of over 500 dealerships in the Asian country.
However, the economical rivals produced locally by native brands did not stand still: Chinese competition soon pushed the Czech brand off the road, which last year managed to place just 15,000 units in China, over 95% less than the historic maximum.
Volkswagen also did not stand still, but instead of finding models capable of competing, it limited itself to reducing costs year after year with heavy cuts to dealerships: in the last period, in short, Chinese customers wanting a Skoda had to go to SAIC-Volkswagen showrooms and accept the “shop-in-shop” format. And now the farewell to the Asian market.
SKODA CENTRAL FOR THE GROUP’S BATTERIES
The decision to leave China means the Bohemian brand is giving up a once important part of its business. But the Group’s saving needs are well known and this announcement had long been expected by several observers.
Skoda, for its part, will play a central role in Volkswagen’s new electric car strategy (a strategy actually considerably scaled down in favor of hybrid solutions) having in fact carried forward work on the new factory dedicated to the production of batteries for electric cars that will be part of the Mladá Boleslav complex, in the Czech Republic.
As already reported, based on the plant’s numbers and the Group’s halt compared to the original electric car plans, Skoda will become the main internal producer for the Volkswagen group’s BEVs. Specifically, these will be lithium-iron-phosphate cell-to-pack accumulators intended to be mounted on the Meb+ platform which will be shared by the German electric vehicles.
