This story was in auto, motor + sport dated 13/12/2012.
Editor Bernd Ostmann mentions that Renault's strategy with value brand Dacia has been very successful. Dacia is selling 800,000 cars a year at a margin of 6-11%. Consultants IHS Automotive predict the value sector will have grown from the current 8m vehicles a year to 10m by 2017.
Vying for sales in the value sector are Dacia, GM (Chevrolet), Suzuki, Nissan, Hyundai and Kia. [Note: not Škoda who now count as too up-market, but surely MG belong here as a brand returning after a long absence].
NEW VOLKSWAGEN GROUP VALUE BRAND
These are competition for VW who have tasked executive Hans Demant (evidently ex-CEO of Opel 2004-2010! http://de.wikipedia.org/wiki/Hans_Demant) and a 20-strong team with creating a car to sell for €7500-€8000 (say £6500) when the China-spec Jetta is €9200 (say £7700).
In January the project will get the go-ahead. Or not: it is not risk-free. VW cars are becoming filled with more and more gadgets and going ever further up-market - what can be left out, what corners can be cut?
Areas to be considered:
1) Lower wage costs: Germany €30.10/hr, Romania €4.50/hr.
2) Simpler production: Body must be ready-pressed in three steps only. The floorpan should be made of three parts then welded together "by hand", not a single complex part. Old machine tools should be used (low depreciation); and drivetrains should deliver low emissions and good economy rather than performance [MG has set "performance" higher in its criteria, hence "highish" CO2 band for MG6 petrol]
3) Engines can come from FAW.
The project will begin as a JV with FAW in China. If it is successful, Volkswagen will replicate it in other countries under its own auspices.
Models:
1) (decision January 2013) Saloon.
2) Estate or Sportback.
3) Shorter model. (Demant "For China we need a big saloon, but for India something a little smaller")
4) and 5) (later) SUV and people carrier.
Planned sales of 500,000 a year between all models. First car launched in 2015 (subject to go-ahead).
DACIA PLANS FOOTNOTE
Dacia plans 1m units production by 2015: a new factory (capacity 400,000) is to open in Tangiers, Morocco. Smaller cars may also be made to sell in the €3,000-€4,500 (say £2,500-£3,500) range in India where the Maruti (Suzuki) Alto and the Hyundai Eon have been very successful.
2015 will be a crowded year!
Editor Bernd Ostmann mentions that Renault's strategy with value brand Dacia has been very successful. Dacia is selling 800,000 cars a year at a margin of 6-11%. Consultants IHS Automotive predict the value sector will have grown from the current 8m vehicles a year to 10m by 2017.
Vying for sales in the value sector are Dacia, GM (Chevrolet), Suzuki, Nissan, Hyundai and Kia. [Note: not Škoda who now count as too up-market, but surely MG belong here as a brand returning after a long absence].
NEW VOLKSWAGEN GROUP VALUE BRAND
These are competition for VW who have tasked executive Hans Demant (evidently ex-CEO of Opel 2004-2010! http://de.wikipedia.org/wiki/Hans_Demant) and a 20-strong team with creating a car to sell for €7500-€8000 (say £6500) when the China-spec Jetta is €9200 (say £7700).
In January the project will get the go-ahead. Or not: it is not risk-free. VW cars are becoming filled with more and more gadgets and going ever further up-market - what can be left out, what corners can be cut?
Areas to be considered:
1) Lower wage costs: Germany €30.10/hr, Romania €4.50/hr.
2) Simpler production: Body must be ready-pressed in three steps only. The floorpan should be made of three parts then welded together "by hand", not a single complex part. Old machine tools should be used (low depreciation); and drivetrains should deliver low emissions and good economy rather than performance [MG has set "performance" higher in its criteria, hence "highish" CO2 band for MG6 petrol]
3) Engines can come from FAW.
The project will begin as a JV with FAW in China. If it is successful, Volkswagen will replicate it in other countries under its own auspices.
Models:
1) (decision January 2013) Saloon.
2) Estate or Sportback.
3) Shorter model. (Demant "For China we need a big saloon, but for India something a little smaller")
4) and 5) (later) SUV and people carrier.
Planned sales of 500,000 a year between all models. First car launched in 2015 (subject to go-ahead).
DACIA PLANS FOOTNOTE
Dacia plans 1m units production by 2015: a new factory (capacity 400,000) is to open in Tangiers, Morocco. Smaller cars may also be made to sell in the €3,000-€4,500 (say £2,500-£3,500) range in India where the Maruti (Suzuki) Alto and the Hyundai Eon have been very successful.
2015 will be a crowded year!
Last edited by patpending on Wed Apr 16, 2014 1:40 pm; edited 2 times in total