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Daewoo future: "No worries" says local arm

Suffering sales: The Nubira has suffered a sales plunge because of a lack of consumer confidence in Daewoo's future

Daewoo Australia is determined to survive and prosper despite the financial problems of its South Korean parent

20 Apr 2001

EMBATTLED Daewoo Motor is keen to promote the message it is down but far from out.

The South Korean car-maker has had to endure a difficult period since being rescued in August, 1999, by creditors who are desperately seeking a buyer for the company.

Ford appeared the likely buyer last year until it pulled out of exclusive bidding rights, leaving GM as the primary candidate.

Daewoo subsequently embarked upon a streamlining process, laying off 6800 of its 22,000 workforce in order to make it appear a more attractive buy for GM.

But the layoffs have sparked fiery union protests, attracting unwanted negative publicity for the company.

Consequently, Daewoo's domestic sales are down by 25 per cent and Australian sales have suffered even more dramatically - slipping to 3061 units until the end of March, compared with 5476 for the same period last year.

Daewoo Automotive Australia executive director Michel de Vriendt says the marque's poor sales performance so far this year is a result of "a downturn in consumer confidence" due to the car-maker's uncertain future.

The local subsidiary plans to rebuild buyer confidence in the brand with its just launched "No worries" marketing campaign that has two tenets: a) Daewoo is here to stay and b) the company's three-year Freecare package means "no worries" as far as the ownership experience is concerned.

The campaign will focus specifically on the Nubira, which has suffered a sharp downturn in sales. Just 742 Nubiras were sold until the end of March, compared with 2007 for the same period last year.

Mr de Vriendt says the Nubira's sales decline was partly a result of increased competition in the small-car segment.

The Toyota Corolla, Nissan Pulsar, Holden Astra and Mitsubishi Lancer have been the dominant performers in this segment and Ford's Laser and Mazda's 323 are likely to experience an upsurge following a recent facelift.

But Mr de Vriendt says the Nubira's Freecare package and keen pricing should enable it to hold its own against its opposition.

He says Daewoo is likely to sell 16,000 cars here this year, compared with 20,514 in 2000 and 21,517 the previous year.

There are no model additions due this year, but a facelifted Matiz is due to come on stream in early 2002.

Apart from the cosmetic upgrades, the pint-sized hatchback will gain a 1.0-litre engine (it currently has an 800cc powerplant) and automatic transmission will be available as an option.

At the other end of the spectrum, Daewoo's new flagship - known as the Magnus in South Korea - is likely to join the local line-up around July, 2002.

The Magnus is sold in South Korea with four-cylinder engines but Daewoo Australia is interested in selling only a six-cylinder version. A 2.5-litre, inline six-cylinder Magnus is in the pipeline, but this won't go into production for at least 12 months.

Mr de Vriendt says the six-cylinder engine, designed by former BMW engineer Ulrich Bez, sounds like a unit that belongs under the bonnet of a car with the spinning propeller badge.

The new flagship will not be called Magnus here, as this name is thought to be too close to Mitsubishi's Magna.

Meanwhile, Daewoo Australia has increased the luxury levels in its flagship Leganza sedan, including new leather upholstery, fully adjustable powered driver's seat, a new six-stacker CD player, a new look dashboard and new alloy wheels.

Pricing remains unchanged at $24,990 for the five-speed manual or $26,990 for the four-speed automatic.

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