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The return of Renault

By / 6 years ago / Comment / No Comments

At the end of 2011 I was invited to a press conference by Renault. The timing was curious as there was no new car due to be launched and Dacia was still on the drawing board. I turned up at the brand’s Maple Cross head office where I met up with a small group of motoring journalists. A quick chat revealed no one knew what was being announced, although with new car sales in serious decline the consensus was this was going to be bad news.

We were right on that score but none of us could have anticipated just how bad it was going to be. Thierry Sybord, the CEO at the time, painted a picture of a brand in decline weighed down by too many poorly selling cars being sold by an over-sized dealer network.

The solution was a cull of its vehicle ranges and dealer network. The Laguna, the car positioned to put Renault on the fleet map, was jettisoned along with the once-popular Espace, the Wind and Modus.

Renault also issued 12-month termination notices to a third of its network as a result of sales halving over the previous five years. This meant shedding 55 sites around the country to slim the network down to 135 outlets.

I subsequently discovered that Paris had seriously considered pulling the plug on its UK operations but wise heads prevailed and the GO5+ re-launch plan was approved and implemented. Central to this was the pending launch of the new-generation Clio and the rollout of the budget Dacia brand to all Renault dealers. A new 4+ servicing package was also unveiled, providing four years/100,000 mile warranty cover on all new cars; a sure sign of renewed confidence in build quality. Dealers were also briefed on forthcoming products including what would eventually materialise as the Captur and the forthcoming Kadjar C-segment crossover.

Fast forward four years and Renault is now in rude health. In 2014 its car sales were up 44% to 66,334 and van sales up 40% to 18,170. Sales this year have remained strong with car volumes up 16.6% and commercials up 37% in Q1. Furthermore the brand’s long-mooted Qashqai-sized (and derived) Kadjar is now poised to go on sale. The brand is also a significant player in the burgeoning EV market with the ZOE and Kangoo ZE, while Dacia’s no-nonsense, no-haggle approach has struck a chord with retail buyers.

Increased sales, better products and renewed confidence has led Renault to talk about expanding its dealer network, rolling out a new corporate look and reaching out to fleets.

Leading Renault Group in the UK since February 2013 has been Ken Ramirez, the Puerto Rico-born Nissan high flyer who became the first senior executive in the Renault-Nissan Alliance to swap brands. As far as he is concerned the brand’s recovery is in line with the GO5+ plan deployed in mid-2013 with the intention of delivering more than 5% group market share, increased dealer profitability and a top 10 ranking in the annual JD Power Customer Satisfaction Survey all by the end of 2017.

“For the past two years we have had a clear direction of where we are going to take the franchise. The renewal of the brand started in Q1 2013 when we knew we had the new Clio, Zoe, Captur and Kadjar coming as well as Dacia.”

Ramirez said the GO5+ plan was more structured than the short-term ones it replaced.

“We drew a line in the sand with our GO5+ plan. From 2013 to 2017 we have a direction. Importantly the plan is for five years. Previously we had a series of short-term plans that had in fact resulted in more damage to the brand and residual values and as a result lower retail performance, which inevitably damages network profitability. This is a five-year commitment,” he said.

The undeniably slick new Renault Store showrooms will help send out the right message to fleet customers. Each site will be required to showcase Renault’s full range of cars, EVs and light commercials and have a designated Dacia area. Furthermore Renault has stuck by its commitment to reduce its previous dependence on fast-churn daily rental business which is good news for RVs, but only desirable new product will sustain the brand’s recovery.

“We have core models driving the image, the profit and the volume – Clio, Captur and now Kadjar. Together these cars will make 60% of our sales and take 60% of our resources. The armoury we identified in 2013 for the five-year plan is now complete with the third weapon, the Kadjar.”

Having seen the phenomenal success of the Qashqai, Ramirez knows exactly how important this vehicle will be at re-establishing the brand’s position in the fleet sector.  

“We start the order take in September and start deliveries in Q4 so the quarter that becomes really important for us is Q1 2016 when we will have full delivery of the Kadjar into a market that is asking for it. The model is important in retail but also gives us a presence in local fleet and corporate fleet as well.”

After some years in the doldrums things are clearly looking up for the brand. The advance word on the Kadjar is positive and the rollout of the new look showrooms is expected to be completed by the end of 2016, much earlier than originally anticipated. Renault’s back and means business.

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