The first new Skoda to be launched will be the new City Car, as it is currently known as, and will be Skoda's "answer to the increasingly strong demand for small cars with low fuel consumption and affordable running costs", according to Skoda chairman Winfried Krause. The City Car will be based on Volkswagen's Up Concept Car, and is set to be launched by the end of 2011

Additionally, Skoda also confirmed that it will launch a new small sedan that will sit in between the Fabia and the Octavia in Skoda's range, and is primarily aimed at emerging markets like China. The car is scheduled to be launched by 2012, and is likely to be based on the VisionD concept car that was showcased at the recent Geneva Motor Show.

Skoda says that both new models will be "practical vehicles with an optimal offer of space and an outstanding price/value ratio." The move is part of Skoda's plans to increase its annual sales to 1.5 million cars globally by 2018, double its current sales volume. Skoda recorded its best ever result of 762,000 units in 2010, and its sales for the first two months of 2011 are already up by 25 per cent over the same period last year.