In order to achieve their targeted market share of 4% in five years, Skoda is betting big on high localization of the Fabia to reduce its price. Localization will increase to 80-90% from its current figure of 50%. This move should have come very earlier. Currently the Skoda Fabia is selling in very poor numbers below 500 mark (last month it sold 291 units), which is not at all a good number for an entry level hatchback of any company. With this localization, Skoda wants to sell 75,000 to 1,00,000 units of the Fabia every year.

Skoda plans to launch the next generation Fabia in India by 2014. The company is already working on the updated model, which will have a huge improvement in terms of design and interiors. Skoda has already revised prices of the Fabia in 2010 and this is the second time they will be doing so. Recently Volkswagen revised prices of the Polo and Vento, which has made it even more difficult for Skoda to position its cars. Thus it is imperative for Skoda to revise its prices quickly.

Another issue with Skoda is the after sales service. Many owners have complained about the below average support from dealers. Skoda plans to address it and is focusing on improving its after sales service. The company will also expand its dealership network across tier-II and tier-III cities. Skoda will also bring in updates to its existing model line-up along with launching more vehicles in the Indian market. The CitiGo is still unconfirmed for a launch in India but could be launched within the next two years.