What’s prompted you to introduce higher-specification Enterprise versions of many of your vehicles? While air conditioning, Bluetooth and reverse parking sensors are all to be welcomed, surely somewhat more basic vans are likely to appeal to customers in today’s tough times?
CP Back in September we introduced models designed to celebrate the company’s 90th anniversary with similar specifications to Enterprise and they proved to be very successful. Our dealers are telling us that there is a demand for better-equipped vehicles.
RH While some businesses are unfortunately struggling at present, equally the truth is that some are enjoying quite buoyant trading conditions and are interested in vans with Enterprise-style specifications. We cannot dwell on just one sector of the market. What we have to do instead is provide a comprehensive portfolio of products that will appeal to a wide variety of customers and provide them with extra value. With our Enterprise models they are getting anywhere from £500 to £1,000 worth of additional features, but at a lower cost. That’s something that is likely to appeal in particular to the owner-driver who spends a lot of time in his vehicle and wants more facilities.
CP It will also result in better residual values.
Once again you’ve expanded your Ready to Run range of special conversions, delivered directly to the dealer and ready to go to work immediately. New additions include a wheelchair-accessible Relay minibus courtesy of Tawe Coachbuilders which should certainly appeal to public sector customers among others. You’ve also introduced a Relay-based low-loader built by KFS under the Plant & Go banner. Do you feel, however, that you are spreading yourselves too thin given the myriad of niches Ready to Run already occupies?
RH I can see why you’d ask that question, but I don’t believe this is the case. And remember that conversions account for anywhere from 12 to 16 per cent of total light commercial sales in the UK. It’s a sector we ignore at our peril.
How are you setting about developing your van dealer network?
CP We have appointed 79 of our dealers as business centres and we’ll have 90 by the end of 2009. All the centres will employ sales people who have received training specifically on commercial vehicles. Furthermore, the centres will have the ability thanks to the training they have received to put together finance packages that will appeal to small- to medium-size businesses. As a company we know how to deal with the local business community; plumbers, electricians, builders and other trades people. So far as we are concerned they are major customers.
RH The fact that we as a group own a bank gives us a considerable advantage when it comes to talking about finance. It’s a strong point in our favour and we have a wide-ranging portfolio of finance offers.
Is it the case that only business centres will be allowed to sell vans from now on?
CP No. All Citroën dealers can still sell vans and I don’t see that changing in the future. What business centres will do is provide customers with more of a bespoke service, especially where conversions and some of the more sophisticated finance products, for example, are concerned.
Are you laying down any ground rules covering dealer workshop opening hours?
RH We want to encourage dealers to offer extended opening hours and even 24-hour opening, but we’re trying not to be proscriptive in this area. Different dealerships have different trading conditions and somebody with a site just off the M25 is not going to be in the same circumstances as somebody with a site in, say, Stirling in Scotland. What we have to do is understand what’s necessary for the local marketing area so far as each dealership is concerned rather than go in with an iron fist. I think that would be the wrong approach.
CP What we certainly appreciate is that customers cannot afford to leave their van to be serviced on, say, a Monday afternoon if they need it for work. And we also understand that if we let somebody have a courtesy vehicle, then it has to be a van they can use for their business rather than a car.
Have you been able to keep the dealer network together given the current economic climate?
RH Yes; remarkably well. Admittedly we’ve had one or two casualties, but the fact that the numbers are so low is absolutely fantastic. We do of course have many dealers who have been with the network for a long time and of late they’ve been joined by a number of large dealer groups that are proving to be strong partners for us. We’ve got around 200 dealers in total.
The Ready to Run line-up referred to earlier includes dual-fuel versions of Nemo, Berlingo and Dispatch converted by Nicholson McLaren to run either on environmentally friendly liquefied petroleum gas (lpg), or petrol. Is it the case that customers are still willing to invest in vehicles like these given the downturn in the economy, or are environmental concerns playing second fiddle to price?
CP There is still a strong demand for such vehicles. Remember that operators of this sort of van can claim exemption from the London congestion charge and that lpg remains a relatively cheap fuel. Remember too that many operators wish to demonstrate their green credentials to their own customers.
Citroën is also developing another electric version of the old-style Berlingo First – several of them are already on trial with La Poste, the French post office – and is working with UK company Ashwoods Automotive to develop a range of hybrid systems suitable for Berlingo, Dispatch and Relay. What impact do you think they will have?
RH The van market looks as though it is heading in the same direction as the car market. This will compel light commercial customers to look at this sort of technology; if not now, then certainly in the future.
