Blog: Renault's Dacia Logan conundrum
Dave Leggett | 2 November 2006
Renault seems to have checked all the right boxes in developing its Logan cheapo car for emerging markets via Dacia. An article we recently published (read it here) drew attention to how it has succeeded where, for example, Fiat's Palio failed. But offering the car in mature markets - a temptation that is perhaps difficult to resist given the exceptionally low production costs - raises a number of issues. Most important of all for Renault, where does such a 'bargain basement' car sit in the context of Renault's desire to move its image upmarket?
Renault dealers may not exactly be clamouring to get their mits on such a low-margin car and the Dacia brand isn't all that supportive to the higher brand values and ideals for the Renault brand that Renault bosses have spoken about. Even when you add in specification, the Logan is still a very basic car.
One interesting idea circulating in Britain (which will likely be a destination for RHD Logans produced in India) might be to offer the car directly to customers via the Internet; Renault dealers then pick up some profitable aftersales business. That is also a viable option when you have a whole new brand to play with, no baggage.
Just as Renault chose to innovate on the manufacture of the car, it can also try something a little new or different on the sales side - it's another opportunity to try and learn something.
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