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Renault Australia sales progress to plan in 2018

Roadblock: Renault Australia took 250 orders for the Trafic in May this year but only delivered 180 vehicles due to a supply issue.

Australia Post fleet contract loss, Trafic supply issue hurt Renault Australia sales

12 Jul 2018

RENAULT Australia say its sales this year are progressing to plan, despite being down 2.8 per cent, to 5439 vehicles, after supply issues plagued a key model and its fleet contract with national postal service Australia Post was not renewed.
 
Speaking to GoAuto this week at the official opening of the world-first Alliance National Distribution Centre in Truganina, Victoria, Renault Australia managing director Andrew Moore said  that sales are currently meeting forecast, although they have been hurt by a supply shortage.
 
“We’re tracking to expectation. We’d probably like to be a tiny bit higher. The Trafic van has hit a few roadblocks this year in May and June, where we’ve just had less supply than required,” he said.
 
“We’ve got very low stock, but it’s sort of two-fold, where we’ve been selling higher than expectation.
 
“We were planning that Trafic might decline this year, and we’d put some things in place and modified that to look at a steady type of position.
 
“We’re ordering cars (with) six months’ lead time, so we’re ordering cars based on that lower expectation.”
 
To the end of March this year, sales of the Trafic were up 30.1 per cent, but this growth has since reduced to 8.1 per cent after supply issues began in May. However, it is still Renault Australia’s second best-selling model, with 1030 examples sold to the end of June.
 
In May alone, Renault Australia took 250 orders for the Trafic but only delivered 180 vehicles. The former would have been a model record for the fifth month of the year, according to Mr Moore.
 
“If that had continued on its trajectory, I’d be sitting here saying we’re quite pleased with where we’re heading,” he said.
 
Mr Moore explained that Renault Australia’s sales have also been hurt after it lost its fleet contract with Australia Post, which moved back to Mercedes-Benz Australia/Pacific, who will supply 1300 of its Sprinter and Vito vans from this year onwards.
 
“We went down very close to the wire, and they made a decision to go with Mercedes,” he said. “We’ve still got a very large fleet out there, and we’re servicing those vehicles.
 
“I know that there’s high satisfaction with our product, but I’m not privy to the other party’s offer, so it’s difficult to assess.”
 
Over the course of Renault Australia’s five-year Australia Post contract, it supplied a “significant fleet” of more than 800 vehicles, including Kangoo, Trafic and Master vans, with the loss of these sales to impact the performance of the latter model in the short term, according to Mr Moore.
 
“If you have a look at this year’s figures, 179 (Australia Post Masters) were sold in January 2017, so Master is well behind (year-to-date),” he said.
 
“But, if you take that 179 (units) out, we’re about eight per cent up year-on-date with Master, so we’ve been stronger with Master than we expected.”
 
Specifically, sales of the Master have taken a hit this year, with 788 examples sold to the end of June – a 13.7 per cent decrease over the 913 deliveries made during the same period in 2017.
 
The mechanically related Master Bus has been hurt harder, with its 98 sales representing a 48.1 per cent drop.
 
Mr Moore admitted a reason why Renault Australia did not have the fleet contract extended was because it could not supply Australia Post with self-shifting examples of the Trafic.
 
“One of the challenges that we had with Australia Post … that definitely impacted the contract scenario – we know this from discussions with Australia Post – is we don’t have an automatic in the Trafic,” he said.
 
“So, that’s the type of vehicle that they want. When you can’t provide it, it’s difficult.”
 
Mr Moore was hopeful that an automatic transmission would soon become available for the Trafic but could not commit to firm timing.
 
“We’re pushing heavily for it, we’ve got about 30 per cent share of the manual market in that segment,” he said.
 
“So, it’s not on the immediate horizon, in terms of a date, but we’re confident we will see one in the future.”
 
The third light-commercial vehicle in Renault Australia’s model line-up, the Kangoo, has stumbled in 2018, with 432 examples sold, equating to an 8.1 per cent drop over the 470 deliveries made last year.
 
Meanwhile, the Koleos mid-size SUV shored up its best-selling position with a record 467 units sold in June, increasing its haul this year to 1763 vehicles, up 16.4 per cent.
 
The Captur small SUV has also been a strong performer, with 230 examples finding homes – 60.8 per cent more than its result in the first six months of 2017.
 
As for the rest of Renault Australia’s model line-up, there is plenty of opportunity for the Megane small car, which is down 18.7 per cent, to 517 deliveries, according to Mr Moore.
 
“The passenger segment that’s been down is the toughest bit. Megane has been very challenging – it’s (in) a very price-sensitive segment,” he said.
 
Renault Australia’s other passenger-car contender, the Clio light hatchback, has also backtracked in 2018, with its sales dipping by 28.1 per cent, to 554 deliveries.
 
As previously reported, Renault Australia is lobbying for the introduction of the Kadjar small SUV and the small Oroch and mid-size Alaskan pick-ups that could boost its sales volume, with Mr Moore saying that negotiations with the French car-maker for the trio have been progressing well.
 
“We haven’t finalised anything, but our discussions have been very positive. So, we’ve ticked off a number of hurdles,” he said.
 
“When I spoke last time, we were on the cusp of the discussions and it just got off the ground, so now, if there’s 10 steps, we’ve been positively received through six of them. We’ve got to see how we go with the next three or four.”
 
Mr Moore indicated that the four common platforms set to underpin nine of the 14 million vehicles sold by 2022 under the Renault-Nissan-Mitsubishi Alliance’s mid-term plan could make right-hand-drive production of desirable models, such as those mentioned, more readily available.
 
“It’s difficult to say categorically, though, because model by model, if we have a shared platform, there’s still a lot of modification for it to be a Nissan vehicle that becomes a Renault. So, that becomes a development consideration and where it’s sourced and so forth,” he said.

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