MUMBAI, FEB 19: Czech car maker Skoda has joined the long list of companies which have either abandoned or postponed their investment plans in Maharashtra. This Volkswagen subsidiary has decided to postpone its plan to invest about Rs 1,100 crore in a new automobile plant, dealing a severe blow to the State government's plans to lure investments. Instead, the car giant is looking at other options like making use of unutilised capacity of other automobile companies for launching its models in India.This is the second auto giant to put off investment in a new vehicle project in the state in the last one year. Italian multinational Fiat had earlier postponed its plan for a brand new plant near Pune.In a recent visit to the State, Skoda officials made it clear that they have not taken any decision to set up a plant in Deputy CM Gopinath Munde's constituency in Shendre near Aurangabad. The Skoda team is not in favour of a massive investment in a new plant at this juncture. "The company has not made up itsmind as yet. we are waiting for them," said State Industry Secretary Yashwant Bhave told this newspaper.Industry sources said cut-throat competition and falling sales in the car market have prompted many car companies to rework their plans in India. Besides, the ongoing price war has pulled down margins in the passenger car business. ``If Rs 1,000 crore is invested, one is not sure about the kind of returns possible in India now. The vehicle market has slowed down here,'' said a source.Interestingly, after a junket to Czechoslovakia, an over-enthusiastic deputy chief minister had made an announcement on behalf of the company that the Czech company has already decided to invest in a new automobile plant in his home constituency. The company, which is part of Volkswagen group, was planning to manufacture its mid-sized Felicia and Octavia models for the Indian market. However, in view of the changed circumstances where the Indian automobile industry has been severely hit by recession, Skoda has decidedto change its plans.The company is now looking at the option to make use of the existing spare capacity of Indian automobile companies which are unable to utilise their plants. In this regard, Skoda officials met the top management of PAL-Peugeot Ltd to use their jinxed plant near Kalyan to assemble cars but did not take any final decision.In its earlier proposal, Skoda had envisaged production of 3,000 cars in the current fiscal but due to sagging automobile markets, they will wait for some more time before plunging into the Indian market.Fiat recently decided not to go ahead with a automobile plant in Ranjangaon near Pune. The company is now making use of its existing plant at Kurla in Mumbai to make Uno cars. It will also launch its future models like Palio and Siena from the Kurla plant. Australian infrastructure firm, P&O is another company which has decided to get out of the State due to lack of local support and government's inability to provide the right atmosphere for inviting freshinvestment.
