Volvo to simplify its model range
Customer confusion and WLTP drive cullVolvo is the latest brand moving to simplify its Australian line-up, culling engines and models and citing consumer confusion as the motivator.
But it is also being forced on Volvo Car Australia by the same tougher new European WLTP emissions regulations that have forced other brands such as Volkswagen to reduce their local line-up.
“I think historically as a brand we’ve had far too much complexity in our offer,” VCA managing director Nick Connor told carsales.com.au.
“There were too many engine variants, too many models and too many variants.”
Diesel engines will be one target of the cull, as that coincides with a global Volvo policy to switch to petrol-electric hybrids and battery electric vehicles.
Moving forward, starting with the XC60, T8 petrol-electric model will migrate exclusively to the Polestar Engineered specification.
The price will go up, but Connor is promising the specification will also go up.
He also said the T4 turbo-petrol engine could be dropped out of the XC40 line-up.
“I think it (complexity) is overwhelming for the customers,” Connor said. “As a customer you sit there and go ‘what the hell!’.
“And, of course, then it also gets very difficult for the dealer because they don’t know what to order and they don’t get the right stock.
“It’s a self-perpetuating problem because they never have the right car to suit a particular customer. I think we made a rod for our own back by giving the consumer so much choice – more choice than they actually want.”
Connor said there isn’t enough testing capacity within WLTP to maintain a complex model offering in Australia, even if VCA wanted to do it.
“It’s making a virtue out of a necessity,” he said.
“I’d rather just simplify the whole process and reduce stock levels. One of the things we have been doing over the last 14 months [since Connor took charge at VCA] is taking dealer stock and our stock right down.
“Excess stock is not healthy for anyone.
“If we make the offer simpler then the dealer’s got a better idea of what to order for the customer. The idea is they’ve got a pipeline of cars coming down the chain and the idea is they sell from the pipeline and not physical stock.
“It’s a simple theory and it works well if you set it up right.”
Please see our Editorial Guidelines & Code of Ethics (including for more information about sponsored content and paid events). The information published on this website is of a general nature only and doesn’t consider your particular circumstances or needs.
