Future

The future of Vauxhall seems, on face value, strong. Although the brand isn’t making huge profits, the awareness of the brand and current model line-up is solid. The introduction of the Astra GTC is a positive move, which should lead to an increase in sales. The return of the Astra VXR will again help the brand with their high performance and sporting heritage.

Crucial, however, is model development. The new Astra VXR, for example, will need to strike a good balance between power, performance and price. The old Astra VXR had the unique selling point of being highly desirable, affordable and very fast. Some reviews considered the car’s performance to compromise the cars handling, however this was a minor criticism to a strong and well-rounded package. All future products must reach very high standards of driving experience and build quality if the brand is to be perceived as a premium brand. 

Electric vehicles will be crucial to this brand as well. Through 2010-2020, we will see a huge movement towards more environmental friendly cars, especially electric vehicles. 2011 saw the first mass produced, fully electric car go on sale, the Nissan Leaf. Vauxhall have only just, in January 2012, started taking orders for a range extended electric vehicle. Their development within this category must be sharpened and sped up. A traditional affordable price should be present without compromising profit margins. Overpricing the vehicle will dramatically reduce sales as Vauxhall do not have a premium brand status (yet), therefore cannot attract premium car buyers which a higher price will target. Making the car less affordable to the mass market is something which must be avoided.

This technology should also be applied to other models within the range to help reduce the overall model emissions and put Vauxhall in a more environmentally friendly light. Announcements of a new twin turbo highly efficient and high performance diesel engine are promising, but the price for this technology is too high to attract mass sales. In today’s increasingly electric-vehicle focused market, the technology is an improvement on last century technology. It has put the Insignia in direct competition, price wise, with better performing, premium brand models.  

It is promising to see a new model being added to the line-up and new segments being entered. The Mokka is set to enter the increasingly popular small SUV market. By combining good fuel economy and a high driving position, this market segment is a good balance between driver needs and economy. Off roaders have long been popular for their high driving position, but condemned for being wasteful, too big and environmentally unfriendly. Reducing the size and increasing economy has brought a smaller off road segment which is beginning to reach a peak in supply. Manufacturers within the market area include BMW, Audi, Ford, Chevrolet, Citroen, Honda, Hyundai, Jeep, Kia, Land Rover, Mini, Mitsubishi and Nissan. Vauxhall face stiff competition from these brands and, again, are late reacting to the market.

Vauxhall should look towards other market segments, especially higher end premium segments and target these with a vehicle which can hold a premium price tag without costing a large amount to develop and produce.

Taking the Calibra as an example, here they took an existing floor plan and applied a highly desirable and well-designed body to it and marketed it using the cars ultra-low drag factor to maximise sales. By sharing components, production costs were reduced and therefore a segment, usually only open to a premium brand was made available to drivers with lower incomes, yet still made for a good profit margin. Peugeot in recent years have taken on the high price Audi TT, which shares components with the VW Golf, with their own premium coupe, the RCZ. Citroen have launched a premium brand, the DS line up, to boost sales and profits of otherwise normal hatchbacks. Combining a unique selling point, such as the Calibra’s record breaking aerodynamics, is a good strategy for having an impact on the market and increasing sales. Introducing a premium brand, much in the same way the VXR brand was introduced in 2004, is also option. 

If we look at Audi’s current line up, you have the A1, A3, S3, RS3, A4, S4, A5, A5 saloon, S5, RS5, A6, S6, A7, S7, A8, S8, Q3, Q5, Q7, TT, and the R8. On top of these models are the S-line upgrade packs. This means each model has a huge amount of variants and, with it, option packs. Each model can be sold with a unique selling point. Vauxhall should look at this for an example when setting out trim levels, and rather than having Exclusiv, SE, SRI trim levels, SRI upgrade packs should be sold alongside each model which will allow each customer to specify their own car to their needs. This personalisation program could bring higher prices and elevate the brand. Car personalisation, especially from the manufacturer, is hugely popular in the current climate. Rolls Royce announced that 2011, they sold more cars in one year than in any other year throughout their 107-year history.   

The research into building cars cheaper without reducing quality is promising. They need to attract bigger profit margins and look towards taking the brand to a more premium status. Introducing a personalisation program, a new model usually associated with premium brand status for a much lower price and increasing component sharing across the range would all help reduce manufacturing costs while increasing forecourt prices.

More brand awareness, increased advertising and special editions will help promote the brand in the media and these should focus around the heritage of the brand and the new technology they are introducing. This will help the public’s awareness and perception of the brand and increase sales.

Continuing with innovating class leading technology and producing bold designs are key to Vauxhall’s success. Vauxhall could become class leaders with technology, but without significant improvements in each vehicles economy whilst maintaining a competitive price, their success will be limited. Combining market strategies from Audi and Citroen, while offering special upgrade packs and continuing to undercut competition on price could be a strong strategy for Vauxhall. Bringing out further VXR models will keep the VXR brand alive and with it, increase Vauxhall's perception as a high performance, and premium, car maker.

Marketing should focus around technology and price, along with increased motorsport involvement being considered. Vauxhall must remain active with regard to advertising as the current car market is moving and developing at a record pace – it is key that Vauxhall remain at the forefront of it, and models like the Astra GTC, Ampera and Mokka prove they are forward thinking.

Vauxhall, in the early years, succeeded by offering and satisfying customers demands. It is important that they look at the current car market and the way it is changing to ensure they can continue doing this. 

Sources

http://www.audi.co.uk/

http://www.carbuzz.co.uk/car-reviews/4x4

http://www.carbuzz.co.uk/blog/Rolls-Royce-Sales-108
Top Gear
Fifth Gear
Autocar magazine
evo magazine
http://www.autocar.co.uk/News/NewsArticle/AllCars/260777/
http://www.autocar.co.uk/vauxhall/
http://www.autocar.co.uk/News/NewsArticle/AllCars/260835/
http://www.parkers.co.uk/cars/reviews/facts-and-figures/vauxhall/frontera/estate-1991/22193/
http://www.vauxhall.co.uk/about-vauxhall/company-information/about-us.html
http://www.vauxhall.co.uk/about-vauxhall/company-information/vauxhall-philosophy.html
http://www.bbc.co.uk/news/business-16066855