Škoda Auto - Sales figures rise, profit decreases clearly

Besides the significant rise in the value of the Czech crown and an aggressive competitive environment, the cause for this development is the first evidence of a decrease in demand in connection with the worldwide crises in the financial markets.

During the first three quarters of 2008, the manufacture of automobiles by the Group has risen at 11.3% in comparison with the previous year (499,182 vehicles). The main increase of the production numbers concerned the model series Škoda Fabia and Škoda Octavia. At the same time, the production volumes of the model Škoda Superb increased as well as its second generation was successfully introduced in the market this year.

Deliveries to customers have increased at 14.8% to a total of 530.924 vehicles in comparison with the same period of the previous year. "However, in comparison to the mid-year results (an increase of 17.9% compared to last year), one can already notice that the speed of growth of our sales is slowing down.

The current insecurity of the future development of the crisis on the financial markets increasingly influences the purchasing intentions of our customers," comments Fred Kappler, member of the board of Škoda Auto for the Sales and Marketing department, this development.

In particular, the Škoda brand was successful on the Eastern European markets (98,519 vehicles; +45.8%), where primarily Russia with 36.898 deliveries to customers (+89.8%) and the Ukraine with 25.387 deliveries to customers (+62.3%) confirmed the expected growth trend. On the Chinese market, 44.843 vehicles (start of sales in June of 2007) were delivered to customers, while India accounted for 13.470 vehicles (+55.3%).

In the first three quarters of 2008, the Škoda Auto Group has contributed with an operative result in the amount of 455 Mio. € to the economic result of the Volkswagen concern. This represents a decrease of 71 Mio. € (-13.4%) compared with the previous year.

In the local balance sheet, the negative influence of the strong Czech crown has left an even greater impression. Earnings from sales have receded to a value of 158.1 bil. CZK (-2.2% compared with the previous year), the operative result has decreased to the amount of 11.4 bil. CZK (-22.8 % compared with the previous year).

"The Czech crown is a major stumbling block that significantly influences our planned expansion in a negative way," comments Holger Kintscher, board member for the Commercial Affairs, the situation and continues: "The situation continues to get worse.

The well-known problems on the steel and raw materials market are now aggravated by the global financial crisis in connection with a worldwide decrease in demand for automobiles. This situation presents us with huge challenges. We will examine everything and will also revise out investment programs."