It’s no secret that 2012 has been a tough year for the commercial vehicle market, but Vauxhall can claim to have fared much better than most. While the market for vans of up to 3.5 tonnes declined by 7.9% in 2012, Vauxhall had a strong 12 months in sales and manufacturing.
The Vivaro was the backbone of both, topping sales in the retail medium van segment for the second year in a row and accounting for more than 90% of the 58,000 plus vans built by Vauxhall last year. But even the Vivaro has not been immune to tough trading conditions, with the Luton factory switching to single-shift working from the start of 2013.
Transport News Brief caught up with Steve Bryant, Vauxhall’s Commercial Vehicle Brand Manager, and Richard Collier, the National Commercial Vehicle Sales Manager, to discuss Vauxhall’s successes and challenges, to look ahead to the company’s 110th anniversary this year, and to hear more about the launch of the all-new Vivaro in 2014.
Both Bryant and Collier are Vauxhall men through and through, especially Steve Bryant. “I joined as an apprentice at the age of 16 back in the ’70s,” he explains. “There aren’t many of us left!
“I have largely worked on the product side of the business. I’ve been a Product Analyst, then worked in the business management division. I went out into the field as a Sales District Manager in the ’80s, before coming back to the product side of the business to work on cars like the Omega and Vectra. About seven years ago I moved across to become the Commercial Vehicle Brand Manager.”
Collier can’t claim the same longevity, but has worked for Vauxhall since 1995, joining from the world of finance. “I started as a Fleet Sales Manager – or a National Account Manager as they were called then.”
After stints in retail and aftersales Collier became National Commercial Vehicle Sales Manager. “About 18 months ago I was given additional responsibility for business-to-business sales. I’m responsible for achieving the national commercial vehicle sales objectives for both fleet and retail, and I’m also responsible for the business-to-business objectives across cars and vans.”
Having clocked up several decades working for the Vauxhall between them, it’s no surprise that both believe building vans in the UK and selling them under a British brand name is a key part of Vauxhall’s appeal to commercial vehicle buyers. “We believe it’s vitally important. Customers see the benefit of having vans built in the UK in terms of protecting British jobs and industry,” says Collier. “It’s not the be-all and end-all, but we’re very much a British brand. It’s a message that we put forward very strongly when we’re talking to existing customers and prospects.”
Collier sees patriotic buying patterns as just one of several reasons for Vauxhall’s trend-bucking sales success in 2012. “We have a fantastic dealer network, and we can offer specialist commercial vehicle support and advice through the retail network that we have. We’ve also had the 4x4x4x4 marketing programme, which consists of four years’ 0% finance, four years’ free servicing, four years’ warranty and four years’ AA cover. We’ve also had a number of model-specific offers. That’s what generates the showroom traffic, and when the customers go into the showroom our dealers have the tools to finish the job.”
Vauxhall CV’s strong sales have been achieved despite some ageing products. The Vivaro’s design dates back to 2001, and is due to be replaced next year, yet overall Vivaro sales were up 2% compared with 2011. Despite being in its run-out year, the Astravan was second in the light van segment for retail customers.
Vauxhall’s newer CVs also played their part. Movano sales were up 11% in a segment which was down 1%, while the Combo light van secured third place in the segment’s retail sales charts in its first year on sale.
“In terms of our own performance, we’re way ahead of plan. Achieving the number one position in retail for the second year running is a fantastic result,” says Collier.
It’s clear that targeting retail success has been the cornerstone of Vauxhall’s sales strategy, and this has been combined with a move away from short-term, big-number deals in the rental market. Collier believes this approach is less risky and benefits resale values. “A large corporate account or a large rental deal can make a very big difference to your overall numbers, but if you lose a large account, you’ve got a very big hole. We’ve actively reduced our short-cycle volume to help improve our residual value performance. Compared with 2009 our rental sales are down 55%.”
Instead of the immediate sales spike of a big daily rental contract, Collier prefers to pursue what he describes as ‘baseline’ business. “That’s what we call fleets of 25 up to circa 300. In this part of the market we’re up 202% compared with 2009. The key thing for us is that having lots of smaller accounts spreads the risk better and this kind of business is generally more profitable.”
When asked what it is about Vauxhall’s commercial vehicles which appeal to these ‘baseline’ customers, Steve Bryant prefers to point to the bigger picture. “It’s a bit of cliché but there’s not really a bad van out there. We prefer to sell the whole package in terms of what Vauxhall can offer in support and backup. We keep our vans competitive and try to nudge ahead of the competition when we can in terms of specification and price.”
One area in which Vauxhall tried to “nudge ahead of the competition” in 2012 was economy and emissions, notably with the Vivaro ecoFLEX. “Volumes are growing quite nicely for us,” reports Bryant. The ecoFLEX version promises 40.9mpg on the combined cycle and carbon dioxide emissions of 180g/km, compared with 37.6mpg and 198g/km for the standard version. Efficiency-enhancing features include exhaust gas recirculation cooling, revised gear ratios, improved thermal management, low rolling resistance tyres and an aerodynamic kit. In last year’s ALD Automotive/Shell FuelSave MPG Marathon, the Vivaro improved on its official figures, achieving 65.16mpg.
“It appeals to those fleets that are aware of their carbon footprint and want to buy green,” says Bryant. Although primarily aimed at fleets, retail interest in ecoFLEX is growing. “Sales are expanding beyond the fleet community. It’s not just about low CO2, you get better fuel economy with it and that appeals to all customers.” Although Bryant wouldn’t be drawn on what percentage of Vivaro sales the ecoFLEX now accounts for, he did confirm that it’s growing.
As well as developing new derivatives like ecoFLEX, Vauxhall is continuing to work closely with a number of specialist converters on niche commercial vehicles. Late last year, it announced a new caged tipper, based on the Movano, developed with conversion specialist VFS. A few weeks earlier, Vauxhall announced a refrigerated Movano derivative, aimed at the fresh and frozen produce industries, and developed in partnership with The Cold Consortium Ltd.
This sector of the industry is grappling with the implications of European Community Whole Vehicle Type Approval, which applies to van converters and bodybuilders from 29 April this year. Vauxhall is pledging to support its partners as they adapt to the new regulations. “It’s quite a change for converters and manufacturers. We’ve been working closely with them, running a workshop for converters and Type Approval was very much at the forefront of that,” Bryant explains. “We’re keeping in touch and constantly updating them as this new legislation gets nearer. Vauxhall is running retailer training so that our dealers understand what’s happening, too. It’s going to be a challenge, but we’re ready for it.”
Bryant sees Vauxhall’s work with companies like VFS and The Cold Consortium continuing through 2013 and beyond. “These partnerships can exploit some of the niche opportunities out there that a big manufacturer can’t fulfil. It works well for us and for the converters, I think.”
Whatever new van conversions come to market over the coming months, none will challenge the new Vivaro’s status as the most eagerly anticipated Vauxhall commercial vehicle. Entering production in 2014, the next-generation Vivaro will be produced in Luton, securing the plant’s future for many years to come.
“We’re working hard on the new Vivaro and really looking forward to it,” says Bryant. “The current van still looks remarkably fresh more than 10 years into its lifecycle, there’s not a whole lot wrong with it. Even so, the new Vivaro will be an all-new van.”
New product should reinforce Vauxhall’s strong sales position, but the next generation Vivaro’s significance to Luton and UK automotive manufacturing in general shouldn’t be underestimated. Luton itself employs around 1,000 workers, and supports many more UK jobs in the supply chain.
“We’ve got a very skilled workforce who produce a very high quality product, and we’re developing up to 30% local product in the new Vivaro,” says Collier. New Vivaro will continue to be built at Luton well into the next decade, giving Vauxhall – and the UK commercial vehicle sector – a good reason for optimism in challenging economic times.