GM Wants Holden To Be No.1

[Univex]

Bruce Newton, drive.com.au, 15/08/06

General Motors says new Commodore should help Holden retake market leadership, writes BRUCE NEWTON.

Holden management isn’t talking bullishly about riding to sales leadership in the new VE Commodore, but their boss at parent General Motors certainly is.

GM chairman and CEO Rick Wagoner made his expectations clear during a video message to a Holden media function last week.

“From where I stand here in Detroit everyone at GM knows the VE Commodore is one of the most significant cars in Holden’s history,” Wagoner said. “It gives the Holden dealer network a fantastic opportunity to help Holden take back market leadership in Australia.”

Holden has not finished on top of the Australian new vehicles sales market since 2002. Toyota has been the leader for the last three years. This year it has stretched its advantage, leading Holden by 36,071 sales after seven months.

The Toyota Corolla has been Australia’s top selling car for the last two months, eclipsing the run-out of the old VZ Commodore. The recast, re-priced new generation VE Commodore range goes on-sale mid August.

And Wagoner is convinced it will have a major impact.

“We know the large car segment has slowed because everyone is waiting for this car (VE) to hit the road and bring buyers back to the segment,” he said.

Others, including Holden managing director Denny Mooney, aren’t so sure the VE is the panacea for the large car segments ills, sales having dropped 22 per cent year-on-year.

Mooney is convinced VE will lift sales and reinforce Commodore’s position as Australia’s top selling car, but a new private-buyer focused sales strategy is designed to maximize profit rather than volume.

“We won’t put too many cars into the market,” Mooney told drive.com.au. “We will be able to grow our residual values with this car. We will not stuff the market with this car, we don’t need too.

“We are trying to get more private retail business with this car, that’s one of the reasons we have realigned the model lineup the way we have. That’s one of the reasons we have dropped prices.

“We want sticker prices out there that are closer to where we know the car will transact in the retail environment. We are counting on more retail business, and retail business from a margin standpoint for us is much better for us than fleet business.

“We want more retail business and our dealers want more retail business. So when you talk about a return on investment, we are betting on more private retail business with this car and better margins. Then we don’t need the volume.

“By not stuffing so many cars in the market it drives up residual values, and if you keep residuals up then lease rates are lower. Everything flows better when you have better residuals.”

This strategy obviously doesn’t fit hand-in-glove with an all-out market leadership attack against Toyota. Instead Mooney points to the future, and an expansion of Holden’s product portfolio.

Primary amongst them is the arrival of the Korean-built Captiva light duty SUV in September, offering up to seven seats and the choice of petrol and turbo-diesel power. Other forthcoming additions to the range will be a Daewoo-built mid-size sedan, Astra coupe-cabrio and Hummer H3 heavy duty 4WD.

“It isn’t necessarily make or break if we have market leadership,” said Mooney. “But with the brand we have and the product portfolio we should be able to have, we should be right in the game fighting for market leadership.”

[Sparta]

Originally Posted by Univex

“From where I stand here in Detroit everyone at GM knows the VE Commodore is one of the most significant cars in Holden’s history,” Wagoner said. “It gives the Holden dealer network a fantastic opportunity to help Holden take back market leadership in Australia.”

Great, now worry about taking back market leadership here.

[GM>Toyota]

I think that with the proper product portfolio they'll be fine. Wait did they just say Hummer H3. Are they going to badge that as a Holden?

[GM>Toyota]

Anybody know what the market share breakdown is in Australia. What's holden's market share and what's toyota's?

[Butz]

I wouldn't bet on the VE for volume, the Daewoos are going to be the volume sellers. And I like how Holden is fighting back Toyota's invasion, nice.

[Univex]

Originally Posted by Butz

I wouldn't bet on the VE for volume, the Daewoos are going to be the volume sellers.

Not in Australia. Commodore is, and will be the number 1 car. This is the bread and butter volume product.

Originally Posted by GM>Toyota

Anybody know what the market share breakdown is in Australia. What's holden's market share and what's toyota's?

Holden's market share is much like GM's historically. Back in the glory days (1950's - 1960's) Holden commanded >50%. Now it sits around 20% and so does Toyota. Currently Toyota is at about 21-22% and Holden is 17-18%.

[JoeT]

Originally Posted by GM>Toyota

Anybody know what the market share breakdown is in Australia. What's holden's market share and what's toyota's?

Click here for all the info you need

[Kheiron]

I'd want holden to be number one also, but in terms of comparisons and profits, not sales/volume. If you get the former right, the latter will come.

[01cavalier]

Originally Posted by Kheiron

I'd want holden to be number one also, but in terms of comparisons and profits, not sales/volume. If you get the former right, the latter will come.

Same applies to GM in the States. It just takes time...Holden should do very well with this car.

[tgagneguam]

How refreshing to think that GM's goal is to be number one; the we'll-take-what's-left-over-just-as-long-as-we-make-a-little-bit-of-money mentality is pathetic and getting quite stale.

[cfch3399]

Good luck with that. I don't see the Commodore posing a threat to the Corolla!?

[tgagneguam]

Originally Posted by JoeT

Click here for all the info you need

I wonder why Ford and Mazda aren't combined (as I think they are in other markets) to make one market-leading force with YTD Australian sales of 123,237 units, just 1,641 units ahead of the vaunted Toyota?

Maybe not, though; that'd make Holden move down a notch to number 3 by volume.

[ChevroletRevived]

The VE is a very important launch for Holden, the most in it's history. I know that the demand for the whole lineup is going to be very strong, espessially when considering the pent up demand and withheld sales. It's a great car, very, very competitive. We all should be very proud of it.

[Univex]

Originally Posted by cfch3399

Good luck with that. I don't see the Commodore posing a threat to the Corolla!?

You can bet your house on commodore knocking off corolla. corolla is taking advantage of the large car segment having a breather waiting for the new commodore to arrive. This has always happened in the past. Corolla will settle into it's usual number 3 position behind Commodore and Falcon by the end of the year. The Australian market is dominated by large sedans although granted not nearly as much as it used to be.

[mikmak]

Don't forget that Mooney also said they are looking to make profit not volume. ie they are steering toward retail purchases. This means they aren't trying for No.1 spot, so don't be dissapointed if it doesn't happen. Corolla still has a strong fleet following.