It seems that hardly a week goes by without a new Chevy-branded vehicle being launched somewhere in the world. From the Cavalier-replacing Cobalt in North America, to the rebadging of Daewoos earlier this year in Turkey and across Western Europe in a few months’ time, to the ‘Chevrolet’ Forester in India, the Niva and Viva in Russia and the Spark in China, GM seems determined to make Chevy the world’s biggest brand. Glenn Brooks reports.
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At last count, with some 45 global vehicles versus close to 60 Toyota-badged equivalents, the Chevrolet brand is still number two. But thanks to the rate at which GM is launching new models, that number one status is well within sight.
So how did GM manage to achieve this extraordinarily stealthy growth and just as importantly, does it stand a chance of reaching what looks a lot like a goal that the corporation seems loathe to acknowledge? The major clue is in the very nature of how it has gone about its brand expansion. This is a global strategy, spread over a vast number of markets that have one thing in common – GM has either been absent from or in decline in each of them. Consider the example of Australia – one of the few decent-sized markets where the company seems not to be thinking of launching Chevy. Why not? It has no need as Holden continues to be a shining example in the GM Empire where products, profitability and market share are the envy of all other players. Let us then look at what GM is up to elsewhere in the world and how Chevy could attain its goal.
North America
Any analysis of the Chevrolet brand must of course start with the US market. Though GM is making a net loss on its global automotive operations (third quarter results included a US$ 656 million contribution from GMAC towards overall US$ 440 million General Motors Corporation net profit), it does not dare to give up its quest for market share. Indeed, its US market share in Q3, led by Chevrolet Division, is up to 28.5% from 28.2% a year ago. As everyone knows, Chevrolet is really all about trucks in the USA but new products such as the Cobalt should have a dramatic impact on car sales numbers – the Cavalier it has just replaced first appeared a decade ago and has needed huge incentives to shift in recent years.
Elsewhere in its US car lines, there’s little cause for excitement. The Malibu, Malibu MAXX, Impala, Monte Carlo and Aveo are, at best, very ordinary products, while the new Uplander minivan is little more than a rebodied Venture, itself not exactly a class leader or conspicuous success since its original release nearly eight years ago. The pricey, low volume SSR and Corvette are no doubt highly profitable as is Chevy’s larger truck line-up. The margins on all those optioned-up $40,000+ Tahoes, Suburbans and Avalanches must be very tasty indeed to GM’s bean counters, not to mention the numbers contributed by the ubiquitous Silverado and its huge annual sales.
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By GlobalDataBut something odd is happening elsewhere in North America: the Chevrolet brand is going Korean. The Aveo, a rebadged Daewoo Kalos, is sold in the US but so far this has been very much a toe in the water exercise, GM no doubt having to go slowly with the UAW watching its every move. But in Canada, it is now possible to buy Korean-built Chevys that are not sold in the US market: the Optra and Epica with the Rezzo on the way (Daewoo Lacetti, Magnus and Tacuma). Meanwhile, in Mexico, a range of models stretching from the Opel-engineered Corsa, Astra, Zafira and Vectra sits alongside the all-American Corvette, TrailBlazer, Suburban and Malibu, while the Brazilian-designed Tornado mini pickup is a clever niche model based on the Opel Corsa.
Europe, Turkey and Russia
In most parts of Europe the Chevy name is currently so far off buyers’ radars that it barely registers. But all this is about to change, with the January 1 introduction of rebadged Daewoo models, GM having decided that Chevrolet should now serve as its entry-level brand. To be sure, it has taken the extraordinary step of selling the new Corvette as a model without a maker. That works for Mini but only because everyone knows the engineering is courtesy of BMW. So why reject the 50+ years of the Chevy part of the Corvette’s heritage? Only GM’s branding specialists know the answer. And where does that leave Opel and Vauxhall? ‘Slightly upmarket’ apparently.
No doubt the success GM has enjoyed in Turkey since it dropped the Daewoo brand and relaunched the model line-up as Chevrolets earlier this year is held up as a clear sign of the way forward. It may turn out to be just that but Turkey is in the midst of a car sales boom and just about any affordable vehicle is moving out of showrooms as soon as it arrives. It will be worth watching how, for example, buyers take to the Chevrolet Evanda in Europe’s big markets. Selling what was already a five year old rebody of the 1996 Daewoo Leganza to people who aren’t even interested in the infinitely superior Opel Vectra and Ford Mondeo looks set to be one of several challenges facing Europe’s new Chevrolet dealers.
As for Russia, still we wait for the promised exports of the new generation Niva SUV. To be fair, only in recent months has it been fitted with an engine that will meet EC emissions regulations (an Opel Family II) but it’s hard to see GM using AvtoVAZ’s giant Togliatti plant for much more than a source of cheap, small 4x4s and sedans (the Daewoo Lacetti is also assembled there as the Chevrolet Viva) for the local market.
China, India, South Africa
What these three markets have in common is the newness of the Chevrolet name, though it should be noted that GM had some Chevy sales in South Africa in the Apartheid era before pulling out, so the brand is at least recognised by many potential buyers.
Entry to the Indian market has been somewhat unusual in that a vehicle that wears the bow-tie badge in no other market, the Subaru-sourced ‘Chevrolet’ Forester, was the first to be assembled locally. Then followed the Daewoo-designed Optra in 2003 and more recently, the Tavera, derived from the Isuzu Panther ten-seat crossover. So far, sales are modest but rising. A major boost may come next year, should GM’s bid to buy the former Daewoo plant in Surajpur succeed – it has already announced its intention to build the Chevrolet Spark there (Daewoo Matiz). So one to watch and another market where the brand sits below Opel, as it does in Japan, South Africa and Europe.
In China, Opel is notable by its absence, its equivalent being Buick. The evidence for Buick remaining an aspirational name in the PRC is clear: rather than drop the sticker of the Opel Corsa-derived Buick Sail to match the lower prices being introduced by rivals in recent months, GM countered by announcing plans to assemble a version of the Daewoo Kalos in Yantai from 2005. Having introduced the Chevrolet name locally in late 2003 with the Matiz-based Spark, it would be logical that this next model would also be a Chevy. Intriguingly, GM has still not confirmed which badge the Kalos-derived vehicle will wear. Whatever its decision, it’s clear that Chevrolet is seen primarily as a low-price make in China.
Asia-Pacific
As mentioned earlier, the ongoing success of Holden and the recent winding up of the local Daewoo operations both point to GM being content to leave well enough alone in Australia. Indeed, the only Chevrolet influence Down Under was an unsuccessful attempt to sell the Suburban as a Holden two years ago, while the Avalanche name is used for an unrelated Holden-based HSV 4×4 wagon.
Meanwhile, in Japan, the Suzuki-built Chevrolet Cruze mini SUV has been a sales disaster. American brands just can’t seem to convince Japanese consumers who largely suspect iffy quality and reject unimaginative interiors when it comes to GM, Ford and Chrysler Group products. Opel does better but then it has worked hard to cultivate its German ‘quality’ image. Would that it could do likewise in Europe.
This article has already talked about the end of Daewoo sales in various markets and the rebadging of the Korean make’s vehicles. However, due mostly to the power of the local unions, GM seems unlikely to replace the Daewoo brand with Chevrolet in South Korea. Nevertheless, Daewoo will soon be limited to South Korea, Vietnam and a few small volume markets.
Overtaking Toyota
So can Chevrolet manage to achieve its desire to build more vehicles than Toyota and gain the cachet that will come with being the world’s biggest automotive brand? Very possibly. Eye-catching new vehicles such as the Journey small SUV that is to be built in Brazil as well as the Equinox and HHR crossover in North America look like adding decent volumes to Chevy’s global sales total, while the rebadged former Daewoo models in Europe should all help add to an increased global sales tally next year. But at what price? In many markets, the Chevy name is increasingly all about offering value for money above all other factors. That’s fine but how do you develop what is effectively a new brand in many big markets on that basis alone? Isn’t that exactly what got the former Daewoo Motor into a tight spot from which it never recovered?
There is a consensus building among many industry observers that somewhere, somehow, Chevrolet has already lost its soul in the quest for numero uno status. Ironically, America’s Automobile magazine has this month rated a Chevrolet (the mid ‘60s Corvette) as its number one in a list of ‘The 100 Coolest Cars’. It sums up its reasons thus: ‘a glorious piece of rolling sculpture that’s bold and brash and loud and fast, all rolled into a single package.’ Sound like any current Chevrolet you can think of?
