After having another live sporting event interrupted by a Holden advertisement proclaiming the great range they will have in showrooms over the next three years, I was curious enough to investigate. Holden has been slipping down the sales ladder for a while now, while the Korean brands head north. At the time of writing this piece, the passenger car and SUV sales chart top 20 contained only one model from Holden. Where is the future of the once dominant brand heading?
Currently, there is very little to get excited about when looking at Holden’s current range. It’s a tired and dated looking line-up of vehicles that only make sense when the purchasing decision comes down solely to the lowest price. The evidence of this can be found in Holden’s performance in the stronger selling segments of the market, medium SUVs, and duel cab utes. The Captiva and Colorado continue to sell based on their price point.
The current Commodore is the exception that proves the rule. The Commodore remains the star of the Holden range and is currently enjoying its farewell tour. But as we all know, the Commodore’s star is fading as the final curtain prepares to fall on local manufacturing.
Unfortunately, for Holden, the best ever Commodore arrived at a time when family buyers are migrating in huge numbers to SUVs. Nevertheless, it’s a strong offering that is worthy of genuine consideration if a large sedan or wagon is needed.
It remains to be seen if Holden can transition its diehard Commodore buyers to an imported model. There have been many reports indicating the name will be retained and applied to a European import. I have a high degree of doubt that this move will be a successful one. Commodore fans are a parochial group and moving them to an imported model may prove challenging. These buyers see the history of the brand tied to the Commodore nameplate and an imported model is unlikely to draw as much enthusiasm.
The Captiva and Colorado are not even close to the best cars on offer in their respective segments. Yet, they continue to sell. Both have a significant price advantage over far more comprehensive offerings from rivals. This raises some interesting questions, does this situation provide the blueprint for Holden in the short term? Is Holden heading towards a future of cheap cars?
After listening to Holden herald the arrival of 20 new models as the company moves towards 2020, I was keen to see what was available to them from the General Motors portfolio. After looking through the models on offer from Chevrolet, Buick, Cadillac, GMC, Opel and Vauxhall nothing stood out as a potential game changer or hero model. In studying the GM catalogue, it’s important to consider what is realistically possible to make it to right-hand drive. The full-size pickup trucks are a good example. They would most likely sell well given Australia’s thirst for utes, however, the business case for right-hand drive will never make economic sense.
Holden has already said a V8 sports model will be here at some stage. The market for this type of car is strong, as evidenced by the success of Ford’s Mustang. Enthusiasts have long argued the merits of having the Camaro and Corvette available in right-hand drive. The possibility of either of these cars coming down under seems very unlikely. It feels like, at every major motor show over the last three years, some GM executive has dropped hints about the availability of future models that Australian motoring writers have deemed newsworthy. The story has remained the same, making a comment, but saying nothing substantial or definitive. This is annoying, to say the least.
Product planning has not been an area of strength for Holden in recent years. Some of their models look good in isolation, but when compared to their competitors, they fall short. The value proposition remains the one strength the brand should try to capitalise on as it looks to halt its sales slide.
The Colorado is due for an update this year, it will be fascinating to see where Holden will set the price. The current 4x4 LS Colorado has been regularly advertised at $36,990. It should aim to not stray too far from this. Doing so would almost certainly lose sales, not increase them.
Holden has effectively swapped places on the sales ladder with Hyundai. Holden could draw inspiration from the way Hyundai established itself with cheap (but relatively reliable) cars and a long warranty. In the context of today’s marketplace, where Australian buyers are developing expensive tastes and increasingly heading to premium brands, it is difficult to see a point where Holden could command top dollar again. The level of competition in growth segments of the market combined with the standard of car they have access to will make it difficult to achieve big gains in market share unless the price is right.
It has been suggested that many of Holden’s new offerings will be sourced from Europe. This could prove dangerous. Many of their current range is manufactured in Asia. Getting supply from Europe may mean a better quality product, but what will the price premium be? And will buyers be prepared to pay it?
Holden is a brand in need of rebuilding its image and position in the Australian market. It can continue to import cars from Asia with a focus on the overall ownership package, a sharp purchase price, low-cost servicing, and a long warranty are ways to get people into the showroom and get the lion badge roaring again.
Let's start a Car Conversation, are you a Holden fan? Where do you think the future of the brand is heading? Do people still genuinely want to buy a Holden?