Tim Smith

SSANGYONG is returning to the Australian market for the third time, now with 32 dealers, but the South Korean car-maker harbours ambitions to increase the number of retailers to more than 40 outlets, with a goal of selling 3500 units in 2019.

SsangYong Australia managing director Tim Smith said the dealer network now in place featured many members who were previous SsangYong franchisees.

“One of the key things will be to repay the dealers who supported the brand before the previous distributor, Ateco Automotive, relinquished the business,” he told GoAutoNews Premium at SsangYong’s launch of its new vehicle range in Marysville in the Victorian high country.

Mr Smith said he wanted the old dealers back on board “to thank them and to show them that the brand can work and become a success story for the franchises”.

“Franchising has been on the nose recently,” he said.

“I want to give dealers a new franchise model. They’ve done the heavy lifting and the majority have now come back to the brand.”

Mr Smith said many inquiries for a franchise have come from dealers who already have Toyota and Holden showrooms.

“We did extensive marketing into why some brands fail and others succeed. It starts with the product and then it’s all about getting the franchised network in place.

“The product side centres on us hitting the hot spots in the market, which is SUVs.

Musso

“That is, smaller SUVs with value-for-money propositions and larger, more capable off-road vehicles that have strong towing capacities and diesel engines.

“For dealers, these points make it easier to sell to customers.”

Mr Smith said supplies of the four models – Tivoli, Tivoli XLV, Rexton and Musso – were contained for 2018.

“We don’t want dealers caught with a lot of current year builds as we go into a new year,” he said.

“It’s actually a good time to launch a new vehicle into the market pre-Christmas because there are few new cars being released. That gives us some attention.”

There is also restraint in what SsangYong Australia is asking of its network, Mr Smith said.

“We pay for the pylons and the dealer pays for signage for the showroom.

“We don’t ask for the big bucks and we don’t want multi-million dollar dealerships as costly buildings don’t lift sales and only make it financially harder for the dealer.

“As soon as the dealer starts losing money, you start to get a lack of interest by the dealerships.

“My objective is to grow the business conservatively and give dealers all the opportunity to grow.

Tivoli

“I want to have a conversation with dealers about what they’re selling and how they’re selling and then back them. Dealers can be engaging about future plans if you don’t get on their backs.

“I have no conditions to the dealers – it’s up to them and their investment.”

SsangYong Australia is also in discussion about branded finance products, including Macquarie Leasing.

Mr Smith said Macquarie’s MotorMe product is “exciting and that can have a place in what we’re doing because it forms a partnership between the OEMs and the dealers”.

“It also provides very rapid revenue recognition by allowing loans to be approved quickly and to get the buyer into a new car faster,” he said.

The company also said it would look at an assurance program that may include guaranteed buy-backs.

“This generally suits high-volume brands and we’re not there yet, but we like the fact it returns high residual values and rewards both the customer – who looks after the car and regularly services it with us – and the dealer with high trade-in prices and strong interest in the vehicles by used-car buyers.”

By Neil Dowling

Rexton