This Monday, Skoda announced that they are integrating Lokel into a new Skoda Digital subsidiary. This newly formed group with around 70 employees will be responsible for their TCMS, diagnostic systems and multimedia systems.

Why it matters: Skoda transitions with this strategic move from a “classic” small OEM in the rolling stock industry being a system integrator towards a company with vertical integration of strategic topics.

The bigger picture: The rolling stock industry goes digital to reach lower LCCs and create new revenue streams. To start, a solid data base and thus a data grabber (the diagnostic system) is necessary. Over the time, investments in data analytics, and LCC reduction initiatives will follow.