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Exclusive: Ateco drops SsangYong brand

Switching channels: SsangYong’s imminent switch to a factory distributor could see models such as the Tivoli come to Australia.

Independent importer Ateco drops SsangYong to focus on LDV, Foton and Maserati

General News logo1 Nov 2016

By DANIEL DeGASPERI

ATECO Automotive executive chairman Neville Crichton has revealed that the independent distributor will no longer handle SsangYong in future and that a factory operation will take over the struggling South Korean brand.

Mr Crichton said the company is, however, committed to firing up Maserati and the two remaining ‘active’ Chinese brands for which it is responsible – Foton and LDV.

LDV is seen as a shining light in the portfolio, with Mr Crichton anticipating 1600 sales this year and more than 6000 units per annum by 2018 when key new models such as an SUV and utility are established in the marketplace.

In comparison, Maserati is trending towards 600 sales this year, and Foton is heading towards 900, while SsangYong, which recorded just 332 sales to the end of September, is running dry in terms of supply – and will not be replenished, under Ateco at least.

In an exclusive interview with GoAuto last week, Mr Crichton was asked whether low, niche-style volumes for its mainstream Chinese and South Korean brands were tricky for an import business to deal with.

“We can’t make money at those volumes, it has got to be bigger volume than that,” he said, revealing that the taps would be switched off for SsangYong as the focus shifts to LDV, Foton and Maserati.

“We won’t be representing SsangYong in the future. We definitely need volume brands and LDV will be a volume brand.”

While Mr Crichton said a factory operation would take over SsangYong distribution in this country, Ateco Automotive director Ric Hull added: “Sales are dwindling down to nothing, there are fewer than 50 units left in dealer stock.”

80 center imageLeft: Ateco Automotive executive chairman Neville Crichton.As GoAuto has reported, SsangYong and Ateco have been at loggerheads for some time over issues such as pricing and specification, which in turn has kept significant new models like the Tivoli compact SUV out of local showrooms.

The company took over the franchise from another independent importer, Sime Darby, in 2012 and had high hopes of increasing sales to 3000 units within 12 months. However, SsangYong sales under Ateco went from 1507 in 2013 to 1280 units a year later, then fell to an even 1000 units in 2015.

Official VFACTS industry sales figures for October will be released later this week, but to the end of September SsangYong’s total of 332 new-vehicle registrations represented a 59.4 per cent downturn on the same period last year.

Its Korando, Stavic and Rexton SUVs had managed only 142, 108 and 39 sales respectively, while the Actyon utility – which is no longer listed on the brand’s Australian website – had found just 43 buyers over the same period.

As with LDV, Mr Crichton does not believe fellow Chinese commercial vehicle manufacturer Foton should be positioned at the bottom end of the market, although with year-to-date sales down 18.0 per cent to 684 units and just the single Tunland ute on the market, growth had not gone as planned.

“We’d like to build it (Foton), it’s gone a wee bit slower than we like,” he said.

“We’re certainly not cheap, we’re priced virtually at the bottom end of the Japanese brands with that product.”

The 2.8-litre turbo-diesel Tunland cab-chassis currently starts at $25,990 driveaway.

Distributed through Ateco subsidiary European Automotive Imports (EAI), the Maserati luxury brand has been a stronger performer for company, however Mr Crichton refused to be drawn into rumours that Fiat Chrysler Automobiles (FCA) is planning to take the brand in-house, as it did with Fiat, Abarth and Alfa Romeo in 2012.

Ateco/EAI was also responsible for Ferrari before a separate factory operation took control of its own affairs in Australia in 2013.

“We sold Alfa Romeo and Fiat to them (FCA) – they didn’t take it in,” said Mr Crichton, while maintaining that those brands remain successful under the Ateco Automotive umbrella in New Zealand.

“We have all the Chrysler Fiat brands in New Zealand, that’s going well … it’s outperforming percentage-wise Chrysler and Jeep in Australia.”

As stocks roll in of the Levante premium SUV to join the existing Ghibli and Quattroporte, the executive chairman said he expected that “we’ll do probably 1200 Maseratis next year”.

Ateco’s other main motor vehicle business, American Special Vehicles, is a right-hand-drive conversion operation for Ram pick-up trucks, run in partnership with the Walkinshaw Automotive Group, and Mr Crichton highlighted the difficulty in growing sales volume when it is “very reliant on currency”.

“With the US dollar it has become a very expensive vehicle, I don’t see much more than 40 to 50 units per month, if that,” he said.

“We’re talking virtually $150,000 to put one of these on the road. It’s not a cheap car.”

Mr Crichton also said there “probably are” other global brands Ateco Automotive is looking at bringing to Australia, but declined to nominate particular marques or provide insight into where he hoped the car import company would be in five years.

“All I can tell you is we’re talking to brand manufacturers all the time,” he said.

“I don’t think anyone has done a start-up brand in Australia in the last five years that’s been successful with it – except us.

“We’re in the car business. Who knows what’s going to happen in five years’ time, we could all be selling electric cars, who knows.”

Ateco also owns the rights to import Chery vehicles, but this brand is currently in recess.

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