Skoda India has advanced its plans to import completely knocked down (CKD) units to the middle of the calendar year, MSN India reported.
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The report said the company had signed an agreement which envisaged import of CKD units only in 2007. The company also plans to sell 8,500 units during the current calendar year, which will include the L&K and Superb special editions.
Skoda India at present imports cars in semi-knocked down (SKD) form and assembles them at its Aurangabad plant. The switchover to CKDs, which has been advanced by three years, will help the company make customs duty savings.
The company also announced plans to enter the used car segment under the brand name Skoda Signature.
A Skoda India spokesman said: “As the company is yet to break even its Indian operations, it does not plan to pass on the savings to its customers.”
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By GlobalData
Skoda India pays a total customs duty, including basic, additional and countervailing duty, of 122% on the parts it imports currently. These rates are applicable to completely built-up units (CBU) though the company contends that its import deserves to be treated under SKD conditions. Under CKD conditions, the total customs duty would be 87%, saving about 40% on duty. A 32.5% excise duty (reduced by 8 per cent in the current union budget) is also levied on cars assembled in the country.
Skoda India sold 6,500 cars in 2002 but does not expect to make a profit until CKD importing has started and the post-2005 WTO import tariff regime comes into force.
The company currently has 134 employees and expects to increase this to 500 to 600 when it moves over to assembling from CKD kits.
