News - Opel
Opel here to stay
Despite a slow start and bad press abroad, Opel is investing heavily to survive
18 Feb 2013
OPEL says it is entering the next phase of its Australian introduction with the rollout of the OPC performance brand, 24-hour test drives, driveaway pricing on selected models and broader rural dealer coverage.
While the German brand admits its 650 sales since September is a modest number, it insists the volume meets internal targets and is in keeping with Opel Australia’s desire to build interest and awareness in the brand for long-term security rather than short-term gain.
Speaking at the launch of the Corsa, Astra and Insignia OPC models in Sydney last week, Opel Australia managing director Bill Mott reiterated it is in Australia for the long haul.
“We set ourselves a series of objectives (when we launched in September 2012),” said Mr Mott.
“Our first objective was to build awareness and interest in our brand.
“Our launch media campaign and involvement in local sports sponsorship has proven extremely successful, with our tracking data showing that three-quarters of Australians are familiar with Opel, so in branding terms we’re off to a very good start.
Left: Opel Australia managing director Bill Mott.
“And our network continues to grow, with new dealers in regional Queensland and New South Wales in Q1 and Q2 this year.” Mr Mott said Opel’s launch timing in September last year was undermined by “a tactical firestorm” where falling commodity prices and a high Australian dollar convinced importers to drop their prices.
“Would we like to sell more cars? Of course we would,” he said.
“Our wagon share is a bit below our expectations, but we’ve done very little in terms of promotions and it’s an area where we have potential.
“But at launch we were effectively the only brand in Australia without a campaign or tactical advertising.
“We faced a fundamental choice of either focussing our brand for the long term or shifting our attention and spend on offers for short-term gain. For us the choice was obvious, and we invested the lion’s share of advertising and promotions for 2012 on building brand awareness and forsaking the temptation for short-term (sales volume).” Mr Mott said the recently launched 24-hour test drive with driveaway pricing on base models, the launch of OPC, and six more country dealers (bringing the national total to 23) are all part of a planned second phase of growing the brand in Australia during this year.
“We know from our dealers (that) once a customer test drives a vehicle the sale is a very easy one, and we expect this sales month to be the best by quite some margin.
“So we have many reasons to believe to be optimistic that our sales growth will be ongoing, with the best advertising for any brand being cars on the road, and that is especially true for Opel given we’re a new brand with especially strong design.
“OPC has a fundamental role to play in defining our brand in this market, and solidify in customers the performance and design pillars of our brand.
“At launch most of our dealers were selling out of temporary showrooms, but now many have moved into permanent installations and the impact has been significant, with sales increasing markedly.
“We will finish all of our metropolitan showrooms in the coming months and we will increase our national footprint by adding dealerships in Cairns, Townsville, Toowoomba, Sunshine Coast, Newcastle and Port Macquarie.” While Mr Mott would not reveal Opel’s volume intentions for this year, he admitted the internal targets reflect the competitiveness of the market.
“It’s all about slow and steady growth.
“We’ve taken a sober and very realistic assessment of the situation.
“We’ve taken a look at what other European brands have done – including VW some years back, where they were and how long it took – and we said that we are going to be a niche brand for some time.
“It will take time to get some traction and get the business, and when it all comes together that’s when there will be momentum. And we’ve already started to see that happen.
“This is an aspirational yet accessible brand, not premium. There is a perception that we will somehow encroach on BMW and Audi and other Germans brands, but that’s not what we’re about, not here and not in Europe.
“We’re much closer to VW, and if you look at our pricing we are more accessible than they are, and the case is the same here in Australia.” Mr Mott emphatically denied that Opel must reach a volume target by a certain deadline or risk closing up shop in Australia.
“Backing out of Australia is not even a consideration. We made the decision to come here with a very sober assessment of what it would take, and we’re all in.
“And this isn’t just Australia, but a global initiative to take Opel abroad.” Opel internationally is operating under a 10-year restructuring and survival plan announced last year that has already led to plant closures in Europe with thousands of jobs lost.
Dubbed ‘Drive 2022’ and involving Opel’s partnership with Peugeot Citroen PSA, the objective is to bring the ailing German brand back to full profitability over the next decade.
However, it has been persistently dogged by rumours that GM is attempting to cut Opel loose once and for all.
“General Motors has repeatedly underlined its commitment to Opel,” said Mr Mott.
“Drive 2022 is our road map to return Opel back to profitability. The fact that it is a 10-year plan is evidence that this will take some time, but also that the task is not insurmountable.
“Our co-operation with PSA is advancing in terms of joint product and engine programs, and in terms of sharing logistics and purchasing.
“And Opel is going on the offensive in Europe. We are, for example, back in sports sponsorship and motorsport.
“Finally, and most importantly, Opel is delivering 23 new models and 13 new engines through 2016. Today Opel has the strongest model portfolio we have ever had, and there is much to come.”
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