Holden: Our 'blokey' image must change

GM Holden has to fundamentally change if it is to recapture its relevance among Australian new-car buyers, managing director Mark Bernhard has candidly declared.

Speaking at a business media briefing at Holden’s Port Melbourne headquarters last night, Bernhard was blunt about the challenges Holden faced as it makes the transition from manufacturer to full-line importer by the end of 2017, but also upbeat about successfully dealing with them.

“For 70 years Holden has been defined by local manufacturing and locally built vehicles,” Bernhard said. “Our challenge is to redefine what Holden means in Australia and recapture our relevance.

“We need to evolve if we are going to flourish,” Bernhard added. “We need to redefine what Holden stands for.”

Bernhard, whose warts-and-all view contrasted with the usual ‘everything is awesome’ presentations made by car companies at media events, even admitted Holden’s image was too “blokey” for some.

“We also have a brand challenge to overcome the perception of the traditional Holden; V8s, Bathurst, manufacturing. In fact, we are probably perceived as a little skewed to the blokey side.

“We need to broaden our appeal to a wider audience, to today’s Australia.

“Our appeal needs to be more multi-cultural, we need to be attracting more young people, we need to be attracting more women to our brand.”

The briefing, which included a preview of Holden’s new marketing and brand activations and the new Acadia SUV, which replaces the Captiva in 2018, revealed in-depth market research commissioned by Holden showed the company had a perception issue with a significant percentage of the Australian public.

“Holden has a big connection into Australian communities -- we are big part of the history of this country,” Bernhard said. “But we need to show today’s Australia who we are, what we stand for and why they should buy Holden products and services.”

Bernhard said Holden’s future business plan would be built around four different areas: customers, brand, products and “our people”.

“This plan belongs to the people at Holden, the men and women who made this company great and who will make it great again,” Bernhard declared.

“Disciplined and focussed execution is critical to our success. For me understanding detailed action plans and initiatives gives me great confidence that we are on the right track.”

Bernhard, who was delivered a truncated version of the message he made to a national dealer conference in Brisbane two weeks ago, said he felt personally motivated to go public about the challenges Holden faced.

“I want to be honest. I think we do have some challenges,” he said.

“At the same time I am tremendously excited about how we are looking to shift the brand, the products we have got coming at us, the work we are doing with our customers.

“But if I just present the happy story to you I don’t think we do ourselves justice. We lose credibility if we are not open and honest with you.”

On product Bernhard conceded Holden currently offered an “old portfolio” but that was rapidly changing now that it could pick and choose across the General Motors family of brands for the vehicles it wanted. For instance, the Acadia is the first ever GMC to wear the Holden badge.

“That means a much more diverse portfolio. No longer will you be able to call us the Commodore car company, but a company with an awesome portfolio of trucks, SUVs, small cars and of course the next-generation Commodore.

Holden has committed to bringing 24 new models to market between 2015 and 2020, and next week the number reaches eight with the launch of the Trailblazer, an upgraded and rebadged version of the Colorado 7.

But it needs plenty more models rolled out as it seeks to arrest the most significant sales slump in its modern history. After recording its lowest sales in 22 years in 2015, it is set to drop lower again in 2016 with sales year-on-year down 7.6 per cent according to VFACTS.

Bernhard said was the end of local manufacturing that actually made Holden’s ability to pick and choose across GM’s global range much more financially accessible.

“As we look forward to 2018 we are not building cars so there is a different level of flexibility,” Bernhard said. “The cars that have been built here have been unbelievably good cars and the backbone of Holden, but we have a different opportunity as we move forward and we are trying to seize on that opportunity.

Holden has announced it will cease manufacturing the Cruze small car in Adelaide on October 7 — the same day Ford Australia closes its factory doors – when it will shed a further 320 workers.

The departure of Cruze takes the Elizabeth plant’s production level down from 240 cars per day to 165, until Commodore production ceases at the end of next year.

Meantime in Victoria, Holden last night confirmed it will close its $400 million V6 engine factory in Port Melbourne in December this year, before which V6s will be stockpiled for fitment to Commodores for at least another year. Holden's first imported Commodore arrives in 2018.

Bernhard stressed that Holden was still committed to the heritage the Commodore name embodies.

“We remain fiercely proudly of our history and that won’t change. Our recent Supercar commitment honours the heritage and it also gives great credibility to our next generation Commodore.”

Bernhard also reiterated that Holden’s business was sustainable without having to be the number-one seller in the marketplace, avoiding the trap his brief predecessor Jerry Dorizas made.

“Holden’s success is not purely about market share, although yes it is a big factor … we will undoubtedly grow share but we are not blindly chasing market share.

“Things like market share will be an outcome.

“For me it’s about a sustainable business. We are not playing a discount game. Number one in market share or sales is not the measure of success.”