Frankfurt show: Peugeot HQ happy with distributor

PEUGEOT sales will increase in Australia when better, more suitable cars are made available, while local sales knowledge is better than brought-in help, according to Peugeot Group chief executive officer Maxime Picat.

Speaking with Australian journalists at the Frankfurt motor show this week, Mr Picat shouldered some of the responsibility for the brand’s relatively poor local showing, but he believes new product coming on-stream in the next 18 months will help local fortunes.

“If I tell you I am happy to have zero-point-something market share, I would be crazy, but I am a pragmatic person every time I am in this situation, it is good news,” said Mr Picat. “Even if I’m making five per cent market share, it’s a good part of the business. So there’s lots of room for improvement.”

Availability of automatic transmissions in key models has been a particular stumbling block for Peugeot Australia. Its parent company still sells a greater percentage of manuals in its stronghold European markets, while right-hand-drive engineering was not a focus of the company in the early part of the decade.

“We clearly have to have do our homework to improve the car, to have good powertrains to be able to compete in the market – which was not the case in the past,” admitted Mr Picat. “Now we start to have offers that are really competitive, but still we have work to do.”

The brand’s new 308 has been critically acclaimed in Australia, and is selling in reasonable numbers for the brand, clocking up 1115 sales so far this year, making it the top seller in the local Peugeot range.

The recently revealed 308 GTi could miss key opportunities without an automatic transmission as an option. This makes it harder to compete on a level playing field with rivals such as the Volkswagen Golf GTI.

Left: Peugeot Group CEO Maxime Picat.

“I would have loved to present to you today a 308 GTi in an automatic gearbox version, but we are so busy with all the regulations we have to pass – Euro 6.1 and very soon Euro 6.2 – so we still need some more time to be able to have all the horsepower available in both manual and automatic,” said Mr Picat.

“We still do have a range of powertrains that are more adapted to outside-of-Europe markets, including yours, so we’ve got great opportunity with our partners to accelerate sales, and we will do that together.”

The new 308 chassis is a modular unit known as the EMP2 that is readily adaptable for right-hand drive, and it will underpin the next generation of SUV products to come from Sochaux, including the 3008Meanwhile, Mr Picat sees no reason to follow the lead of competitors such as Volkswagen, Mercedes-Benz and Hyundai and set up a factory-owned distribution business.

Currently, the Peugeot franchise is held by Sime Darby Motors, which also distributed Peugeot’s PSA sister brand Citroen.

“I’ve got so many examples of importers that are doing amazing jobs (for Peugeot) that honestly this is not a philosophical question at all for me,” said Mr Picat. “I’m 100 per cent sure an importer can do an excellent job, and sometimes better than us.

“At the beginning, I still had some subsidiaries with French people (in charge) not understanding the country and making wrong decisions. With an importer I don’t have that risk.”

Mr Picat pointed to markets in Europe that have thrived without factory intervention.

“I switched our Greek importer recently, who drove the business from two per cent market share to seven, and our Danish importers have pushed Peugeot to the same level as Volkswagen in their market with 11 per cent share,” he said.

“I would never say ‘let me do the job, I will do a better job’. I see my competitors putting in lots of money, but our own target is to be efficient. It is one of the reasons how fast we were able to recover (from the company’s early 2000s downturn).”

The Peugeot Group CEO, who has just celebrated his third anniversary in the top job, believes that times have changed, and that excessive input from head office can be detrimental to a concession’s success.

“I’m not interested in saying that ‘you must push the car at this price, we must build lots of cars, or you have to put lots of media and marketing in’ we are not interested in that,” he said. “We have to find a good balance for Australia and other markets. But the old way of just putting in lots of money doesn’t work any more.”

Peugeot Australia marketing and communications manager Tyson Bowen told journalists that Sime Derby restructured the business in 2014 in collaboration with Peugeot head office.

“We chased efficiencies based on the lead of PSA, brought in new people across the board, and made changes in pricing, fleet, servicing and customer care,” said Mr Tyson. “Last year we made the hard decisions, this year we’ll solidify everything and prepare for better things.”

Peugeot’s local sales are currently running 3.6 per cent ahead on a year-by-year basis, with 2998 cars finding homes by the end of August.

The 308 is the company’s number-one seller, notching up 1116 sales, while the Mitsubishi ASX-twinned 4008 is the second-most popular Pug, posting up 622 registrations.