Skoda is considering exporting the made-in-India Kylaq to the European market as a crossover alternative to the Fabia hatchback. Launched here at the tail-end of 2024, the Kylaq is the third Skoda model to come out of Skoda-VW’s ‘India 2.0’ strategy and the Czech carmaker’s smallest SUV to date. While the Kylaq is designed specifically for the Indian market, Skoda feels the compact SUV carries enough pedigree and appeal for European customers.
Autocar India’s recent Pune to Prague drive, a 19,000km cross-continent journey that covered several European countries, including the Czech Republic, the brand’s home country, established the Kylaq as a product that could blend well into some of Skoda’s key markets. “We're looking into a possibility or an opportunity to bring the Kylaq to Europe, but there are a lot of barriers, a lot of homologation questions,” Skoda CEO Klaus Zellmer told us after the conclusion of the cross-continent Kylaq road trip.
1.0 TSI or 1.5 TSI for the Euro-spec Kylaq?
In India, the Kylaq is powered solely by the locally manufactured 115hp 1.0-litre 3-cyl direct-injection turbo-petrol engine (1.0 TSI), which can be had with either a 6-speed manual or 6-speed automatic. For Europe, however, Skoda might equip the Kylaq with the 1.5-litre 4-cyl direct-injection turbo-petrol mill (1.5 TSI) seen in the Slavia and Kushaq, paired with a 7-speed DCT.
The 1.5 TSI engine is used in Skoda’s other models and is already Euro 7-compliant, making it the logical choice for export markets. However, from a cost perspective, the 1.0 TSI is more attractive as it is a three-cylinder unit and is locally produced. However, the 1.0 TSI does not meet Euro 7 standards, and upgrading it to the latest emission standards will call for significant upfront investment, which will impact the overall cost of the Kylaq for exports.
If Skoda decides to use the 1.5 TSI for the export version of the Kylaq, it will likely be in a lower 115hp state of tune to help meet the Euro 7 targets. In fact, the Kylaq 1.5 TSI could be offered in two states of tune for the European market, but it is not clear what the other power output of the engine would be.
Beyond emission regulations, the Kylaq would have to meet Europe’s safety, security and other homologation requirements that would again add to the cost of the vehicle.
India-EU FTA and weak rupee help Kylaq's export business case
The incoming India-EU FTA, in conjunction with the depreciating rupee against the euro, makes a strong case for exporting the Kylaq to Europe. Piyush Arora, MD of Skoda Auto Volkswagen India Private Limited (SAVWIPL), said that the India-EU FTA will "open up opportunities" for SAVWIPL across all of its business verticals, including CBU imports, components, fully developing new models for India, and exporting cars to the European market.
A final decision has not yet been taken. However, a European programme would mark a significant step for Skoda Auto Volkswagen India by moving the country’s role beyond developing and manufacturing vehicles for India and other emerging markets to supplying a product to the carmaker’s home region.
With inputs from Hormazd Sorabjee.