News - SsangYong
SsangYong committed to Australia for the long haul
Australia has the first factory-backed SsangYong operation outside South Korea
27 Jul 2018
By TUNG NGUYEN in SEOUL
SSANGYONG executive director of export markets Daniel Rim says that success in the Australian market will not come quickly, but the South Korean brand is investing heavily in marketing and product localisation to steadily grow market share in the long term.
Confirmed to relaunch Down Under in November with four models – the Tivoli small SUV, the related extended-wheelbase XLV, Musso pick-up and Rexton seven seater SUV – Australia will be the first export market with a fully factory-backed SsangYong operation.
The other circa-125 global markets fall under a distributorship model, which Australia was previously party to with Ateco Automotive handling importation of SsangYong vehicles from 2013 to 2016.
Mr Rim, who oversees the Australian and other global markets, said now that the brand has full control over importation, distributorship, sales and aftersales, it is in for the long haul.
“There are limitations that distributors have – just the nature of the business – and by us getting into the market and establishing our own operation, we are going to invest more in the brand building,” he said.
“Typically, distributors engage more actively in retailing and transactional promotions, less on the brand promotions.
“When we get into Australia, we’ll be heavily investing in brand building, I think that’s a long-term strategy, whereas distributors look at short-to-mid term, we are looking at much longer term.
“So we are going to put a significant investment into the brand and the customer care, we’re not looking for a quarterly profit, we’re working for long-term goals and long-term sustainability.”
Mr Rim would not be drawn on sales expectations, but said he expected the initial roll out of models to result in more sales than the brand’s peak under Ateco distributorship.
“That’s a question I try to avoid,” he joked. “We have aspirational but achievable targets within our company. At the peak there were about 1600-1700 (sales) back in 2012. I think we will do far more than that.
“It's (Australia is) one of the most competitive markets with over 60 brands competing and at a very competitive price. As you know, Korea is not the lowest (cost) country labour wise, but we have to stay very competitive and we offer a competitive product.
“That will be our challenge, but we will be very wise where we invest – in the brand, in customer care services and optimise our spending so we offer competitive prices to stay afloat in business.”
Mr Rim said SsangYong’s SUV product portfolio suits the trends of the Australian market that skews more heavily towards crossovers than passenger cars, and that it would succeed where other recently arrived brands such as MG Motor have not had a significant impact on the market.
“First of all, what will make and break (you) is your product, if you have the right product, I think that’s going to help you succeed in a particular market,” he said.
“Our product is well suited for the Australian market, so we’re confident. And another thing we’re confident about is we take care of our customers, we take care of, let’s say the value chains, we take care of our distributors, so we take care of our dealers and the consumers.”
Active safety will be offered on Australian models, but whether that is across the range or only on some variants is yet to be seen.
The company will also ensure local suspension tuning on the Musso at first before rolling out to the rest of the SsangYong line-up in future.
Details involving capped-price servicing and a “competitive warranty” period are still yet to be decided, but announcements will likely come closer to launch.
SsangYong Australia managing director Tim Smith told journalists the brand is contemplating matching Kia’s seven-year/unlimited kilometre assurance period, but stopped short of announcing the warranty period.
“It’s always a trade-off, you offer more warranty, you develop more customers, but it comes with financial burdens, so we are analysing the trade-offs,” he said.
“We do recognise that customers in Australia want safety, they want extended warranty, so we’ll keep that in our business plan.”
Mr Smith said with all the right parts now in place for the relaunch, the South Korean brand would be in the Australian market for the long haul.
“The products will do a lot of that work for us,” he said. “A lot of our key stakeholders will be working importantly in that process. Our dealer network and the products will be doing all our heavy lifting.
“But we also want to be comprehensive. Our offer to the market will be comprehensive, strong warranty, local tuning. We will be doing everything in our power ensuring products, franchise offering and customer service will be as good and better than our competition.
“Going forward, we would love to be part of Australian culture and Australian lives and offer our brand as a real alternative to our competitors, but that has to be balanced infrastructure, resources, investment and profitability that we do.
“But we’re not going away, we’re here for the long term.”
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