Czech auto major Skoda Auto on Tuesday said it will bring back the Octavia, the car with which it entered the Indian market in 2001, this Diwali.
The company is looking to shrug off sluggish sales and resurrect its position in the domestic market.
Skoda, a part of the Volkswagen Group, the world's third-largest auto maker, also said it is working on the possibility of making a sub-4 metre entry -evel sedan based on its small car Fabia.
The car will compete with the likes of the Maruti Swift Dzire, Toyota Etios and the soon to be launched Honda Amaze.
Cars with a length of less than 4 metre attract a much lower excise duty of 12% in India compared to its bigger peers that attract 24-27% duty.
A number of firms have looked at tweaking their existing sedans to help them price their cars competitively.
"Theoretically it is possible to make a car that has a small boot and is no longer than 4 metres. But it is not easy to do so and does not come naturally to us," said Frank Welsch, member of board of management, technical development, Skoda AG.
"We are studying the possibility and working on it. There is still some way to go before we can say for sure but we are interested. We know about the success of the (Maruti) Dzire in India and are aware of the Honda Amaze."
The Octavia comes back to the Indian market after a hiatus of 3 years.
It was discontinued after stricter emission norms came into force in 2010, even as it continued in global markets.
To be launched during the festive season this year, the Laura will make way for it this time.
"The Octavia is at the heart of our brand and key to our growth targets for the future," said Winfried Vahland, chairman, board of directors, Skoda Auto.
"It will come to India later this year and replace the Laura. It perfectly combines the qualities of a mid-size car at the price of a compact car," Vahland added.
Skoda is targeting sales of 1.5 million units worldwide by 2018 to help parent group Volkswagen emerge as the world's largest automotive group, overtaking Toyota and General Motors.
It is hopes to sell 500,000 units per year of the new Octavia worldwide.
The new car is expected to help Skoda get back to its leadership position in the executive sedan segment.
Last year, sales of the Laura declined by 38% to 3,647 units and it was behind the Toyota Corolla and Chevrolet Cruze in its segment. The company grew by only 1.3% to 34,678 units during the year.
(The writer's travel and stay to Geneva was sponsored by Skoda Auto.)