Skoda, the Czech brand that originated more than a century ago, has evolved into a line of upscale cars sold everywhere but North America. They embody most of the technical characteristics of VWs -- in much the same way that Chevrolet and Buick brands reflect similar General Motors design and engineering.
The discussion, which comes amid the reservation of trademarks in the U.S. used for Skoda vehicle models, could mean the brand is taking seriously the encouragement of Matthias Mueller, VW's CEO, to decentralize the German automaker's decision-making.
This month, VW is expected to take the wraps off Mueller's Strategy 2025 plan, a response to improve profitability in the wake of the disastrous events of last September when the company conceded that it faked emissions test results for millions of diesel engines following an accusation by the U.S. Environmental Protection Agency. Martin Winterkorn, chief executive, resigned.
Newly promoted VW executives, including Mueller, who have taken the place of those pushed aside after the scandal, have expressed optimism that VW will bounce back. Statements from the top suggest that Mueller has been granted the authority to lead an overhaul of VW's tight, centrally controlled culture that for years mirrored the wishes and tastes of onetime CEO and chairman Ferdinand Piech.
Analysts, at least initially, are skeptical about the introduction of yet one more brand into an already crowded U.S. market, even if it might remove some pressure from the tarnished VW name. Skoda tried unsuccessfully to sell its cars in the U.S. in the 1960s, long before VW acquired it.
"Skoda in the U.S. makes no sense," said Karl Brauer, an analyst for Kbb.com. "Look at Alfa Romeo, Fiat and Maserati -- all brands with little-to-no recent history in the U.S., going up against established brands like Chevrolet, Ford and Honda, which are making more competitive vehicles than ever before."
Stephanie Brinley, a senior analyst for IHS Automotive said: "I don't think it's clear or obvious that VW's image is so permanently damaged that it must be tossed out, in the U.S. or any other market. The cost and effort to introduce a new brand could prove more expensive than waiting out the current predicament and rebuilding customer trust in the VW brand."
Jack Nerad, an analyst for Cox Automotive, pointed to the difficulties encountered by Toyota's failed attempt to create a youth brand in the U.S. with Scion.
The possibility of Skoda's introduction to the U.S. was first mentioned on Monday by Handelsblatt, a German newspaper. VW may be doing no more than floating a trial balloon to gauge analyst reaction or, perhaps, to show the world that its thinking has become less rigid and monolithic under new leadership.
Skoda's future -- as well as that of VW's other 11 brands from Audi to Bentley -- could be further clarified when Mueller lifts the wraps on his plan.
Doron Levin is the host of "In the Driver Seat," broadcast on SiriusXM Insight 121, Saturday at noon, encore Sunday at 9 a.m.
This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.