Volkswagen Group has launched Skoda in Vietnam with local distribution and planned local production through Thanh Cong Group.

“Our medium term plan is to engage around 30 local contractors, assemble around 30,000 cars from CKD kits, and realise a sales potential of 40,000 vehicles annually beyond 2030,” said Skoda sales and marketing chief Martin Jahn.

The Karoq and Kodiaq would be the first models on sale - imported from Europe.

The first showroom in Hanoi opened yesterday.

Skoda plans to expand the dealer network to 20 by 2025 and 30 by 2028.

Octavia and Superb will also be imported in “the medium term” as well as the electric Enyaq.

Local CKD assembly is planned to start in 2024 with the first Kushaq kits shipped from Skoda India's Pune factory rather than the Czech Republic. The Slavia would follow in 2025.

Skoda started local assembly in India in 2001 with SKD kits and later expanded the factory to build from CKD packs. In 2007 it started SKD Skoda (and VW) assembly in Kaluga, Russia, but the plant was sold to a local group earlier this year after VW withdrew from Russia following the Ukraine invasion.

For this latest overseas production venture, TC Group has started construction of a factory at the Viet Hung Industrial Park in Quang Ninh province.

Capacity at the facility could be expanded in future as Skoda sees Vietnam as a gateway to ASEAN countries.