Last year Skoda came of age in the fleet market. For the first time it sold more cars into fleet and leasing companies than it did into the retail sector.

Fleet business rose 3.2% on 2007 to 19,528 units, taking a 1.8% share of the sector. The company’s ambitions extend to a 2.5% market share.

“We see huge potential for Skoda in the 25-100 car sector and with 100-300 fleets,” said Martin Burke, Skoda head of sales. “We can’t compete with the terms offered by the likes of Ford, Vauxhall and even Volkswagen in the 300-plus market.”

Skoda has successfully changed its image with fleet managers – they talk convincingly about its quality and are happy to add it to their choice lists – but it still suffers from badge snobbery with drivers.

Burke recognises the issue and says it is the company’s biggest challenge.

Skoda research has found that most potential buyers are reps piling up motorway miles. It plans to base its marketing around this, targeting service stations and putting adverts on the sides of trucks.

It is also planning a campaign with Costa Coffee. “The average user-chooser spends 28 minutes having coffee,” said Burke.

“We need to focus our appeal and marketing at those routes.”

In January Skoda launched user-chooser ride and drive days. It has held 10 so far, attracting between 20 and 50 people, and plans to hold another 15 this year.

“Companies are nominated by our fleet field team to take part,” Burke said. “We have to get people to sit in the car and drive it. We find they are surprised by the breadth of our range and the quality of our cars.”

He believes Skoda’s total cost of ownership makes it very competitive, but is concerned that too many people look in simple terms at the amount of upfront discount that they can negotiate.“People need to be educated about total cost of ownership.”

The Octavia and the Superb are Skoda’s two big fleet champions – Octavia accounts for 70% of its fleet sales; Superb 20%. The company is pushing a premium value proposition focusing on wholelife costs and residual values.

While other manufacturers are pumping money into creating fleet dealer networks, Skoda is moving the other way. It believes its 38 fleet specialist retailers will sell to local business fleets regardless of the official programme and has diverted funds into offering a better deal for leasing companies and larger fleets.

Since launching its Agency plan last year, borrowing heavily from parent brand Volkswagen’s programme, it has signed up 44 leasing companies, including 27 of the FN50; it hopes to have 52 by the end of the year. The eventual plan is to have all of the FN50 and some of the bigger corporate customers as well.

In June Skoda will launch a full facelift of the Octavia VRS and Scout and a Greenline version of the Octavia.

The Greenline will emit just 116g/km CO2 and will be targeted at fleets. It will mean that Skoda has a Greenline derivative for Fabia, Octavia and Superb.

In mid-September it launches the Yeti ‘lifestyle crossover’. Volumes are slated at 2,500-3,000 with fleet user choosers accounting for 40%.

At the end of the year, possibly nudging into 2010, Skoda will launch the Superb estate. It features some innovative touches such as spot lights in the boot lid to light the loading bay at night, and a hidden compartment under a flat lid which folds up to split the boot and stop items moving about.
Next year, the Fabia VRS will come to market, followed by a facelift of the Fabia and the Roomster. The Skoda model range will be further broadened in 2011.