Huge price increase! 2022 Skoda Fabia confirmed for Australia and will be more expensive than Mazda 2 and Volkswagen Polo?

Buyers expecting the return of an affordable entry level Skoda set to be disappointed, with the brand’s Australian arm announcing that it has no immediate plans to persist with cheaper versions of the new generation Fabia hatchback.

Instead, Skoda Australia will launch the new generation Fabia light car in a single highly specified variant, known as the Monte Carlo 150, and it will be on sale locally in the third quarter of 2022.

The 150 is the horsepower figure for this new model, which translates to 110kW - meaning it will likely share the same powertrain as high-spec versions of the larger Scala hatch, a 1.5-litre four-cylinder turbo-petrol with 110kW/250Nm.

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The brand is at pains to point out that this all new version of the Fabia is considerably more sizeable than its predecessor, and also notably better equipped in terms of both available safety technology and other in-car tech as well. However, abandoning the once-fruitful grounds of entry-level Skoda motoring is something that can't be ignored.

For context, the previous-generation Fabia - which was on sale here from 2015 - started life as a $15,990 (MSRP) five-door, five-speed manual city hatchback, with the range eventually topped by a Monte Carlo wagon with dual-clutch auto transmission at $29,990 drive-away.

It's that sort of pricing that customers can expect... though there won't be a wagon this time around, and the hatch could well go beyond that price point at launch.

The company’s head of sales and planning, Kieran Merrigan, told CarsGuide this week that the brand is happy to be launching with a single high spec variant, though he admitted that it does come at the cost of abandoning buyers who are after a more affordable Skoda product.

"That's the Launch Edition, we will launch with that car only. As to what happens beyond that, it's questionable. We are looking at other variants, but all I'll say is that they'd be one to two years away," said Mr Merrigan.

"It just comes down to the volume of Fabias we're going to get. Instead of adding different variants, and complexity for the sake of complexity, we'll get what our customers want in the right volumes."

However, Mr Merrigan admits that the Fabia Monte Carlo wasn't the best-selling variant of the previous-generation range. 

"No, it would have been 30 per cent. I think the beauty of our range is that we still have a focus on passenger cars. We have an awesome SUV range, but passenger cars are by no means dead, there are still people that don't need to ride high, which is why we think the Fabia is a cool alternative for someone who might not want a small or light SUV," said Mr Merrigan.

When asked if the brand is worried about losing entry-level customers altogether, Mr Merrigan suggested that at this point in time, they couldn't attract them anyway due to severe supply constraints.

"It's not [a concern] because we don't have the supply to be able to, I suppose, compete in the volumes that would sustain that business model," said Mr Merrigan.

Dan Degasperi, Skoda Australia product and PR communications manager, said it was important to remember that buyers will also get more car for their money.

"This generation of Fabia leaps up in size quite dramatically - it's as large, or larger, than the biggest of those 'light' hatches and edges into 'small' car territory," he said, describing two different sales categorisations that are traditionally referred to in the passenger car world. Think of it this way - a Mazda 2 is a light car, a Mazda 3 is a small car.

The new model is 4108mm long (was 3997mm), 1780mm wide (was 1732mm) and 1459mm (was 1467mm), so it clearly has a longer, sleeker and broader size than the last model. For context in terms of length, a Mazda 2 is 4065mm and a Mazda 3 spans 4460mm, so the new Fabia is certainly on the more dimunitive end of the scale for a car that apparently bridges the gap between size categories. However, Skoda is eager to point out that the interior dimensions are comparable to larger hatchbacks like the Mazda3, Hyundai i30 and Toyota Corolla, and the boot capacity - for instance - is a sizeable 380 litres, definitely more capacious than the big-sellers in the small-car class.

Indeed the company admits the new model will be considerably more expensive, citing the fact that it plans to offer customers alternatives around the $30,000 mark – being this new highly specified Fabia Monte Carlo, entry level versions of the Kamiq small SUV (from $34,690 MSRP), the Karoq mid-sized SUV (from $34,590 MSRP), and affordable versions of the larger Scala hatchback (starting at $31,990 MSRP).

"Bringing the price point up for Skoda to, for example, a $30,000 price point, what choice do you give customers? They'll choose if they want a high-spec light car, or a lower-spec, larger car. And I think that's the paradigm shift we've seen customers really embrace."

Stay tuned for more on the new-generation Skoda Fabia as news comes to hand.