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Skoda's first-half deliveries fall 31%, sees steady markets ahead

Kitco News

PRAGUE (Reuters) - Skoda Auto sees signs of recovery after first-half deliveries crashed 31% amid coronavirus lockdown measures, the Czech carmaker owned by Volkswagen (VOWG_p.DE) said on Friday.

The company, a bellwether for the Czech economy which contracted by a record 10.7% year-on-year in the second quarter, said it expected global markets to stabilise gradually as long as the coronavirus pandemic does not worsen significantly.

Skoda delivered 426,700 cars in January to June while sales revenue fell by a quarter to 7.55 billion euros ($8.95 billion)and operating profit sank 72% to 228 million euros.

It said that its programme to restart operations since June had shown positive effects and said incoming orders had started to exceed last year’s level. Demand at European dealerships had increased, it added.

“In June we were able to make significant gains compared to the previous months,” said Skoda board member for sales, Alain Favey. “We expect a recovery in the third quarter and anticipate a return to the previous year’s level in the fourth quarter.”

Skoda, the country’s biggest exporter that delivered 1.24 million vehicles in 2019, said it was continuing to roll out the largest model campaign in its history, with 30 new models - including electric vehicles - launching between 2019 and 2022.

The company’s Czech factories shut for 39 days after the coronavirus pandemic hit Europe in March, a major blow to an economy that relies heavily on the car industry.

Reporting by Jason Hovet; Editing by Jason Neely and Edmund Blair

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