No silver bullet for Peugeot and Citroen in Australia; dealers set to go

Speaking to the Australian media at the launch of the new Peugeot 3008, Nick Senior, the Asia-Pacific boss of distribution company Inchcape, says the challenge ahead for both Peugeot and Citroen has not been underestimated, but the opportunity for a successful business exists - if the right ingredients are put together.

“We have certainly not underestimated the job ahead, it’s going to be a challenge,” Senior said.

“I do also believe that there is no silver bullet, it’s going to be a mixture of hard work investment, innovation, commitment, attitude and, above all else, accountability from everyone. Us, PSA (Groupe PSA, parent of Peugeot and Citroen) and the dealer network, but if we get those ingredients right along the journey we will be able to celebrate some success.”

According to Senior, the continuous move towards more premium cars in Australia is going to have a big impact on the French brands.

“The 'Premiumisation' of Australia means more and more buyers are considering European premium products, and these brands fulfil that criteria. It’s our job to tell the customers about the products, create that awareness, and get them on the consideration list.”

Furthermore, the brand’s high awareness will come into play once the other pieces of the puzzle fall into place.

“[There’s] a huge but latent admiration for both brands," Senior said. "Both have a rich history, a rich history in Australia that we need to exploit.”

Even so, Senior is aware that it will need to do things differently to the previous distributor, Sime Darby, if it’s to make any serious headway.

“There is a need for change. Firstly, we are going to be operating the two brands as one company - we are not big enough to fragment the team. The investment and infrastructure will be Peugeot Citroen Australia, so dealers will be visited by one person representing the two brands.

“Secondly, we will be amalgamating the brands and network structure. There will not be a Peugeot corner in one and a Citroen in another, our vision is to have every dealer in Australia selling both Citroen and Peugeot. It will be a gradual transformation but we hope to have it completed by end of 2018.”

Senior says that in order for the two brands to thrive, the dealers need to be profitable long-term, which means that some current dealers will be let go as part of a restructure.

“An active, vibrant and accountable network is the cornerstone of our future growth. That means we need a profitable dealer network and we are a long way away from that at the moment - too many dealers with too small a throughput.

“So in the next few months, we are going to complete a review of the network and network structure. We want our metro dealers to get to 75 vehicles per month and our provincial dealers to get to 30 per month in the longer term, and that network plan will reflect that ambition.”

Inchcape itself will also seek to own and operate dealers so that it can show its long-term commitment and investment in the brands, a level of assurance that previous distributorships never showed.

Peugeot will launch the 3008 SUV this month, followed by the updated 308 in September before the arrival of the seven-seater 5008 at the very end of the year. Watch for our Australian first-drive review to come soon, and read our international drive below.

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