GM will remove Holden brand
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GM will remove Holden brand
- A few weeks ago, Inovev indicated that the Holden brand (a subsidiary of the GM group) was threatened because its sales had collapsed in the only market where it was still present, namely the Australian market. The GM group has just announced that it will supress its Holden brand in 2020 because its low diffusion no longer justify its existence.
- The Australian brand Holden was bought by the American group GM in 1931. It only produced and sold its models for the demand of the Australian and New Zealand markets. For several years, Holden was one of the two most important carmakers in Australia and New Zealand, with Ford, and this lasted until 2014.
- The brand's most legendary model was the Commodore, the best-selling upper mid-range sedan (D segment) until 2014, originally derived from the Opel Rekord and Commodore, but which continued its own life long after GM stopped to market on the European market.
- The Holden factory in Australia closed in 2017. Following the closure, Holden fell from second to sixth place in 2018 and then to tenth in 2019, with only 4% of the market and 43,000 sales (against 178,000 in 2004 ). It was obvious that with such a disaffection, the brand could not continue to survive and the GM group made a logical decision. This decision follows a process which see 7 brands stopped in less than ten years: Opel, Vauxhall, Pontiac, Saturn, Saab, Hummer and today Holden.
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Inovev forecast 15,000 units per year of the new DS 9
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Inovev forecast 15,000 units per year of the new DS 9
- The brand DS (premium brand of the PSA group) has unveiled its new model, the DS 9, a sedan positioned between the D and E segments by its dimensions. Actually, the DS 9 is 4.93m long while a Mercedes C-Class is 4.68m and a Mercedes E-Class is 4.92m. This latest DS model is based on the EMP2 platform (also used by the Peugeot 508) but stretched out by about twenty centimetres.
- Today DS portfolio is only composed of two SUVs DS 3 Crossback(launched in 2018) and DS 7 Crossback(launched in 2017) as the DS 3 sedan was ended at the end of last year, after the DS 4 and DS 5. The DS product range is undergoing reconstruction and should be enriched with new models in 2021 and 2022.
- The DS 9 will be produced only in China, with Dongfeng, probably because China is supposed to become the first market for this car.
- The DS 9 will initially be powered by plug-in hybrid engines, branded “E-Tense”, using the thermal four-cylinder 1.6 petrol engine mounted on the Peugeot 508, 3008 and 5008, and DS 7 Crossback. In addition, the electric power will deliver various power (225hp, 250hp or 360hp) according to the configuration. In the most powerful specification, the DS 9 becomes an all-wheel drive.
- According to Inovev, the DS 9 could be sold at 15,000 units worldwide, 2/3 in China and 1/3 in Europe. Certainly a low volume but a more realistic tentative to exist in an hyper competitive premium market.
- Note: this analysis and the related forecast have been constructed before the COVID-19 crisis.
The objective is to provide objective information regarding the activities of carmakers.
The objective is to provide objective information regarding the activities of carmakers.
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続きを読む... Inovev forecast 15,000 units per year of the new DS 9
Renault-Samsung's status in South Korea
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Renault-Samsung's status in South Korea
- Renault-Samsung is a minor player in Korea, both in terms of production with 4% of the local 2019 production (165,000 units out of a Korean total of 3.8 million) and in terms of sales with only 5% of Korean market. Its unique plant in Busan offers a capacity of 270,000 vehicles per year, producing in 2019 seven different models of the Renault-Nissan group:
• Three SUVs: Nissan Rogue, Renault Koleos and Renault-Samsung QM6.
• Four sedans: Renault-Samsung SM3, SM5, SM6, SM7
- But today only 61% of this capacity is used. More over, this utilisation rate has been reached thanks to Nissan Rogue and Renault Koleos models, which are only produced for export (North America for the Rogue and Europe for the Koléos). The Busan plant exports 80% of its production using these two models. The remaining 20% produced are Renault-Samsung models marketed in Korea (QM6, SM3, SM5, SM6 and SM7).
- These models experienced sales decrease from year to year, and only the QM6 (Korean version of Koléos) is still produced at a middle mass volume (close to 60 000 units in 2019). The future of the Busan plant therefore seems very unclear since Renault is not planning to replace the Renault-Samsung sedans which do not meet success on the Korean market. The XM3 (Korean version of the Renault Arkana) has just been put into production in Busan, which could be exported in Europe under the name of Renault Arkana. But even with this new model added to the production lines, the Busan plant will not reach its production capacity limit.
- Indeed, this plant could be used by Nissan as a backup plan of its Sunderland plant (UK), in the case that the Brexit negotiations with Europe put the carmaker in a difficult position. A decision which could be accelerated by the COVID-19 crisis (as South Korea seems to better manage the situation than Europe). Consequently, it is not a non sense to imagine that part of Nissan Qashqai could be also produced in Korea (not totally as the capacity is not high enough).
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Analysis of the automotive production in South Korea
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Analysis of the automotive production in South Korea
- Four automotive groups are operating in South Korea:
1. The Hyundai-Kia group is the most powerful carmaker established in Korea (fifth largest carmaker in the world). It’s a Korean national group formed in 1998 when Hyundai acquired Kia.
2. GM Korea (Korean subsidiary of the American group GM) was formed in 2001 by the acquisition of the Korean automotive company Daewoo. Today, GM Korea is experiencing great difficulties due to the end of its exports to Europe, Russia and USA, following the discontinuation of the Chevrolet brand in Europe and Russia, and the relocation of various models to Mexico. Production of Opel branded cars in Korea will also stop in 2020 as PSA took over Opel.
3. Renault-Samsung (Renault's Korean subsidiary) was created following the acquisition of Samsung Motors by Renault in 2000.
4. Ssangyong(Korean subsidiary of Mahindra) was formed following the acquisition of Ssangyong by the Indian Mahindra in 2011.
- The Hyundai-Kia group has therefore become over the years the only independent national Korean carmaker. Hyundai-Kia gets 70% of the Korean market with locally based production, which is also exported worldwide. However, since several years now, plants located in Europe and North America have slightly reduced the volume of its exports.
- Consequently, even if the global production has increased these last years, and as a consequence of relocation on targeted markets and GM strategy, the Korean production has been slowly declining for several years, from 4.5 million units in 2015 to 3.8 million in 2019.
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続きを読む... Analysis of the automotive production in South Korea
How can French carmakers develop in China?
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How can French carmakers develop in China?
- French carmakers, as observed in a recent analysis, have seen their sales plummet on the Chinese market in recent years. The PSA group fell to 115,000 sales in 2019 against 730,000 in 2015, Renault to 18,000 sales against 72,000 in 2017. How the two French carmakers can still operate in China, in an increasingly competitive environment? How these carmakers can differentiate themselves to popular German brands (Volkswagen, Audi, BMW, Mercedes) or the less expensive Chinese models?
- Inovev thinks that a way which should be explored would be to rely on the image of luxury products that France represents in this country. Up to now, French carmakers didn’t succeed to create luxury or premium brands in China (or in other markets). DS from PSA tried to develop but, so far, still cannot propose models which can be seen as different (in terms of design or technologies) from other products proposed by main stream brands (European, Japanese or Korean) or even Chinese local brands.
- On the other hand, France is renowned in China on luxury cosmetic and fashion fields and Chinese tourists are very fond of these goods when they visit France. Therefore, French carmakers should capitalise on this success not in a minor way as today (promoting new cars with Paris Tour Eiffel or Champs Elysée in the background is not enough), but with a major ambition: creating a real luxury brand in association with and using the name of a luxury fashion house!
- Luxury French fashion houses (Louis Vuitton, Hermès, Channel…) has a tradition of mastering luxury products and are organised to always maintain a very high level of finished products: human resources skills and knowledge, materials choices, relation with suppliers, marketing, brand image management, customer experience…
The current organisation of French carmakers (technical centres, sales channels) limit the emergence of a real “Premium or Luxury” philosophy and therefore brand.
The current organisation of French carmakers (technical centres, sales channels) limit the emergence of a real “Premium or Luxury” philosophy and therefore brand.
- In addition, French carmakers should learn from a recent success story of a new Premium brand recently launched onto western markets and also Chinese market: Tesla. Of course Tesla is famous for its battery electric vehicles (BEVs) but has also to be analysed as the only recent brand which succeed to compete with German Premium brands, in a such short period of time. French carmakers, and especially Renault-Nissan group, is well placed in the BEV market with models relatively well sold (Nissan Leaf and Renault Zoe). It has therefore the knowledge on how to produce BEVs.
- The conclusion of this short analysis is that French carmakers with its current products, failed to convince Chinese customers and to take advantage of the last 15 years booming market. A new opportunity is emerging with electric cars. French carmakers should seriously considered a disruptive way to address the future needs of the 1st worldwide market, and creating a new luxury electric automotive brand using a French luxury house could be an answer.
Contact us: info@inovev.com