Skoda posts strong profit for 2021 as production restarts

Skoda is enjoying a relatively strong 2021 despite semiconductor related setbacks, posting a high operating profit for the first three quarters of the year.

Having endured a tough 2020, the Czech manufacturer has bounced back this year, posting an operating profit of €900 million (AU$1.39 billion) so far, a 92 per cent increase over its figures to the same point 12 months ago.

A 6.8 per cent return on sales has helped boost Skoda's sales revenue to €13.33bn (AU$20.56bn) for the year, thanks to the 596,100 vehicles sold worldwide throughout 2021.

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Despite overall deliveries to customers dropping from 721,900 units to 700,700 units – a 2.9 per cent drop – this has been attributed to the Chinese market, as deliveries excluding the world's most populous country were up by 8.5 per cent from 597,000 to 648,000.

Production of vehicles has also seen a slight increase for the Czech brand – 575,000 in 2020 to 578,200 in 2021 – although this was before a two-week shutdown which started on October 18 due to a shortage of semiconductors.

While it had previously anticipated 1.3 million vehicles to roll off its Czech production lines throughout 2021, the pause could reduce this number to around 1.15 million – roughly the same as its efforts in COVID-affected 2020.

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Chrisian Schenk, a Skoda board member for finance and IT, said the lack of supply has affected the manufacturer's overall output but its focus remains on keeping its staff employed.

“Since the third quarter, the semiconductor shortage and the limited availability of parts due to bottlenecks in the automotive supply chains have been a bitter setback for ŠKODA AUTO’s strong growth trajectory," said Schenk.

"Despite high demand and high order backlogs for our successful products, we have had to cut back our production. Against this background, however, we almost doubled our operating profit in the first three quarters compared to the previous year thanks to consistently managing the product mix and rigorously reducing costs despite the lower deliveries."

"Alongside the Czech government, our social partner KOVO [union] and the Volkswagen Group, we are working tirelessly on measures to overcome the semiconductor crisis and safeguard jobs at ŠKODA AUTO and our suppliers over the long term."

Parent company Volkswagen has also been affected by the semiconductor shortage, with stock of its Australian models reduced while its head plant in Wolfsburg is set for its lowest year of production since 1958.