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Skoda, a subsidiary brand of Volkswagen Group, not only belongs to the same level as Volkswagen, but also has a competitive relationship, and has an extraordinary position abroad. However, when it comes to the domestic market, everything seems to have changed. Skoda's performance is not as dazzling as Volkswagen, and it even has to rely on the "halo" of Volkswagen. Skoda, which originally did not have much competitiveness with Volkswagen, now has to face one more Volkswagen Group for a new domestic brand-Jetta.

A new brand Jetta, which has been on the market for only a few months, has achieved a good result of selling more than 40,000 units in the domestic market in three months by virtue of differential competition. In the face of such strong competition, SAIC Volkswagen Skoda has decided to set up a special R & D department and lower R & D standards so as to improve market competitiveness.

According to SAIC-Volkswagen, Skoda did this because Skoda and Volkswagen belong to the same R & D department, so the R & D standards are the same and the cost is difficult to control. Unlike Volkswagen brands, Skoda has a long reputation in the domestic market, while Skoda, which entered late, is more like a brand under Volkswagen, so Skoda is obviously unable to compete with Volkswagen.

In this regard, SAIC Volkswagen Kodak will decide to set up its own R & D department and sales department to give consumers a more attractive and reasonable pricing, as well as greater terminal discounts in exchange for consumers' favor. At the same time, SAIC Volkswagen Skoda also said that its brand positioning is still higher than that of Jetta.

Everyone who understands Volkswagen is buying Skoda, but in spite of this, Skoda's sales share is gradually declining. At its peak, Skoda sold 1 million vehicles in 2013, but then the trend began to decline, with cumulative sales of 324000 vehicles in 2017 and rebounding to 341000 in 2018, but in 2019, as the market changed sharply, domestic car companies were facing a decline. Skoda is no exception, with cumulative sales of 243210 vehicles from January to November this year, down 24.4 per cent from the same period last year.

Some industry analysts said that if SAIC Skoda can maintain the same or slightly declining sales, it will not cause SAIC Volkswagen to lose its position as the annual champion of auto companies this year.

Jia Ming, deputy general manager of SAIC Volkswagen sales and Marketing Executive and general manager of SAIC Volkswagen sales Company, has also said that Skoda will convey Skoda's more personalized, younger, and more positive brand perception to consumers to form a differentiated competition with Volkswagen. From Skoda's continuous launch of similar sports positioning GT models, we can see that Skoda still wants to determine market positioning with its own characteristics.

In the case that Skoda and Volkswagen have the same platform and suppliers, and the price has always been about 15% lower than the price of Volkswagen, Skoda believes that it is caused by its own lack of brand characteristics, obviously not. In the face of the current rapidly changing market, market share has been eroded step by step, therefore, price reduction, low-end is now Skoda must take the road, a clear understanding of their own positioning, self-lowering to survive, is more in line with the development direction of the domestic market.

After positioning down, Skoda will form a certain competitive advantage to Korean brands, first-line independent brands and Jetta, which is obvious. However, while probing down the positioning, the cost will also be reduced. Skoda is already different from the public. For example, the engine block material of Tuguan L is made of aluminum alloy, while Kodiak's engine material is made of cast iron; the soundproof cotton under the engine cover is standard, but Kodiak does not have either high or low configuration. If the positioning dips down, it is difficult for consumers to accept the larger configuration and reduction.

No matter whether Skoda will have an advantage after positioning down, it is inevitable for Skoda to adjust its position in time if it wants to survive in the domestic market. It is more influential than Jeddas Kodak. It is obviously feasible to significantly reduce the price in exchange for the market, as can be seen from the performance of Jetta.

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