News - Holden
Number two will do
Holden’s new sales and marketing chief puts profit ahead of market leadership
30 Nov 2005
HOLDEN has vowed not to chase market leadership at the expense of profit, leaving the way clear for Toyota to consolidate its hold as the number-one brand in this country.
The company’s new executive director of sales, marketing and after-sales, Alan Batey, said that although market leadership was a healthy aspiration, it was not something the Fishermens Bend-based company would pursue at all costs.
"We are not going to do anything that will in any way deteriorate either our brand health or our level of customer satisfaction and our commitment to our business, just to chase a number-one position," he said.
"It’s not sustainable. We are not going to chase market leadership at any cost."A 26-year veteran of the General Motors empire, Mr Batey has replaced Ross McKenzie, who was instrumental in building the brand on the back of GM’s European offerings.
After a month in the job, Mr Batey yesterday gave an overview of some of his targets. Key among them was the ongoing need to build the brand’s strength and further leverage the Commodore brand.
"The brand I find here is extremely strong – (and) it’s my responsibility to grow that strength," he said. "The dealer network is also a major strength.
"They’ve made genuine investments in our business. Our customer satisfaction ratings are extremely good in the areas of purchase satisfaction and service satisfaction.
"So those things are already strengths but at the same time the market is changing and growing.
"Our job is to use those great foundations but to improve on every one of those things." His other key objective was to seize opportunities to continue broadening Holden’s product portfolio, which in recent months has placed a heavier emphasis on budget models sourced from GM Daewoo in South Korea – namely the Barina and Viva (pictured below) – rather than premium offerings from Opel in Europe.
This will continue next year with the introduction of two Korean-built four-wheel drive wagons, the first of which will be a full-size 4WD to be called Captiva in some markets. (Holden remains silent on its name for the vehicle, though it has confirmed that it will not be called Jackaroo.)"What we’re really doing is leveraging GM on a global basis and using the strength of GM to meet certain segment requirements," Mr Batey said. "Clearly, there is a huge opportunity with affordability in the Australian market, and that was the whole reason why we did GM-Daewoo.
"In the future, our job is to use the strength of GM on a global basis to bring the right product, wherever that product may be."He said the venerable Commodore – and an unspecified number of derivatives – would remain part of the Australian streetscape, despite a softening in the large-car segment and rising fuel prices.
"It’s still the best-selling large car," he said. "One in 10 vehicles on the road today is a Commodore ... that’s a huge owner base."On the question of alternative-fuelled Commodores, Holden’s marketing director John Elsworth said that although LPG had grown in stature among fleets it still had a low take-up.
He said the company would introduce latest-generation diesel engines in some imported models over the next few years, but that a diesel-powered Commodore was still up to five years away.
"I don’t think anyone is going to sit here and say a diesel Commodore is going to happen quickly," he said.
Nonetheless, Commodore would remain a key plank in the company’s product offensive, according to Mr Batey.
"That will continue to be a very, very important seller," he said.
Mr Batey also gave the thumbs up to Holden’s continued motorsport involvement as being vital to the brand’s existence here.
A Brit, Mr Batey comes to Holden from the management team responsible for the acquisition of Daewoo and the turnaround there under the GMDaewoo moniker that has seen exports grow from 250,000 to almost a million vehicles this year.
He has also worked for Opel in Germany and Holland, and started his career with GM as an apprentice at Vauxhall in the UK while studying mechanical engineering.
Mr Batey was quick to dispel suggestions yesterday that Holden could suffer a buyer backlash because of the woes of its Detroit-based parent, General Motors, which is facing plant closures, massive layoffs and possible bankruptcy.
"We have not seen our market share decline based on any announcements that have been made either to the parent or the announcements we made in regard to the third shift here in Australia," he said.
Holden recently cut its third shift at its Elizabeth plant in Adelaide because of slowing Commodore sales.
Mr Batey also said he did not believe that struggling US-based GM affiliates would cannibalise export potential in regions to which Holden currently exports, including the Middle East.
"We’re under no illusions that we have to continue to perform but we’ve seen no evidence that we’re not going to be able to do that," he said.
Pricing deal a ‘success’HOLDEN’S controversial employee pricing strategy to shift a backlog of inventory has a limited life, according to marketing director John Elsworth.
Mr Elsworth said the strategy, adapted from a template used by General Motors inthe United States, had been well received by dealers and that customers had warmed to the national television ad campaign.
However, he said that unlike GM in the US, Holden chose not to publish the actual value of the discounts.
"It makes it very difficult to turn off a program when you’ve published pricing," he said.
Nor were the discounts as massive as suggested in some media reports, he said.
"They’re not massive discounts. They are discounts that relate to certain products, whether they be aged inventory or runout models."Holden admitted it had between 10,000 and 12,000 vehicles to get rid of.
Holden’s new marketing boss Alan Batey also insisted the strategy was "not a firesale type of promotion”"It was done in a classy way. From that point of view we think it’s been verysuccessful,” he said.
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