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Renault baulks at Kadjar

Captive audience: Renault will not consider more SUVs for the local range until its baby Captur and larger Koleos have built more of a following.

Kadjar large SUV off the Renault cards until Captur and Koleos established

6 May 2015

RENAULT is resisting the temptation to add a third SUV to its local range until its freshly arrived Captur and longstanding Koleos models are winning more attention in Australia's fastest growing segment.

While the recently unveiled Kadjar high-rider appears like a good fit for the crossover-hungry Australian market, Renault says taking on too many models too early could be damaging to the French brand.

Instead, the company will concentrate on promoting its existing brace of SUVs as well as other present and future models, in a bid to grow overall volume to a point that permits the addition of more diamond-badged hardware to its Australian line-up.

Speaking at the launch of the third-generation Trafic LCV, Renault Australia managing director Justin Hocevar told media the company's priority was to support the current line-up rather than to expand it.

“At this point in time, relative to our scale, our network and our product portfolio, we don't want to add too much complexity,” he said. “We want to make sure we get good performance out of what we've got before we start introducing more products.

“If you look at what we could source, there's a multitude of models, but at the moment we've got to make sure we focus on not too much product proliferation.

“Right products at the right price for the market, build our customer base and network, and then we can start looking at how we address scale.

“We have to be really disciplined.”

For now, that disciplined approach will limit the Renault SUV line-up to just two models including a forthcoming new-generation Koleos, putting the brakes on the Nissan Qashqai platform-sharing Kadjar.

“Our focus is on Captur, current Koleos and next-generation Koleos,” said Mr Hocevar before highlighting the cost of introducing new models.

“The average SUV needs upwards of $4 million,” he said. “Given that propensity in the medium-sized SUV market for people to go either way, you're just better off making sure you've got really good coverage of one (model) and getting your volume out of that.”

While some rival car-makers have adopted the strategy of offering at least one model in each segment, Mr Hocevar believes customers are far more influenced by price rather than segmentation, and are attracted to SUVs in neighbouring size categories if the value is right.

“That cross-shopping between the two (segments) is very clear,” he said.

“What's the best strategy to offer a product to that buyer-type and get the most traction with the right budget?“We are still conquesting and growing and I would like to have a Koleos – current and next-generation – at a very attractive price and a good level of specification and still be able to cover certain products.”

The volume-boosting strategy also involves cutting out underachievers from the range such as the poor-performing Fluence small sedan, and reallocating resources to models with greater potential.

The Kadjar is almost identical in dimensions to the current Koleos, but the next-generation is likely to grow, allowing the Kadjar to slot into the middle of the range between Captur and its bigger sister if it is chalked for Australia.

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