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Great Wall wrangle edges towards deal
Light at the end of the Great Wall tunnel as Chinese factory and distributor talk on
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7 Oct 2015
AUSTRALIA’S Great Wall vehicle distribution impasse might finally be nearing resolution, with the warring parties seemingly edging closer to a deal to settle the future of the Chinese brand in this country.
Despite the heat in the dispute, Great Wall Motors management in China and the current distributor for Australia and New Zealand – Ateco Automotive – are both increasingly tired of their dragging dispute and keen to put it behind them through the current legal arbitration process.
The wrangle over car pricing and other costs that came to a head last year has effectively paralysed the brand in Australia, with no new vehicles being imported and just 129 residual vehicles sold so far this year.
Ateco wants out from what it sees as an untenable arrangement, but only if it is paid what it sees as a fair price for the brand it believes it has created in Australia since it started handling Great Wall vehicles in 2009.
Great Wall is willing to take the franchise back, but is baulking at Ateco’s demands for compensation.
Essentially, it is now an argument over the residual value of the brand, which has not improved as the Mexican stand-off continues.
At Ateco, fresh Chinese brands such as LDV and Foton have effectively replaced Great Wall in its Chinese vehicle battle plan.
For its part, Great Wall has been busy launching its Haval premium SUV brand in Australia, going to market this week with three all-new models distributed by a factory-run organisation, Haval Motors Australia (HMA), based in Melbourne.
HMA executives were reluctant to discuss the Great Wall issue at the Haval launch, saying the matter was too sensitive.
However, when it was suggested that Great Wall was walking away from its Australian dealers and customers, HMA chief marketing officer Tim Smith replied: “No-one is walking away from Great Wall.”
Mr Smith said Great Wall Motors wanted to take the high moral ground on the issue, not just for the existing customers but also the dealers and the distributor.
“If anyone else wants to talk about it, no problem,” he said. “But never ever doubt our resolve in making sure those three stakeholders are at the very top of our processes and our discussions.”
HMA has indicated it will set new standards of customer service and retail experience through its new Haval franchise, higher than those of Great Wall and its dealer network.
It is unclear what will happen to Great Wall distribution once the wrangle is settled, but GoAuto assumes it will be absorbed by HMA.
The ageing range of utes and SUVs will be discontinued, with the V240 and V200 utes replaced by a newer model based on a fresh Great Wall Wingle ute.
Great Wall sales peaked in 2012 when Ateco shifted 11,006 Great Wall vehicles, but then the bubble burst and volumes plummeted 44.5 per cent in 2013.
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