Mark Gallivan – Motor Industry Report
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The rise and rise of Dacia – I asked Denis Le Vot Executive Vice-President, CEO Dacia Brand what we should expect to see.
Last month Dacia announced its intentions in Paris to pull the brand further into the affordable mobility demographic by announcing upcoming radical design elements that will trickle down from the company’s Manifesto concept car. Under the Renault Group’s control since 1999 Dacia’s clear growth intention is to offer customers the essentials needed for affordable motoring by keeping the car’s technology simple and patently avoiding needless fripperies that add cost to their model range. Presented to the assembled motoring press were the new “DC” enblem, corporate identity, expanded dealerships, and now the promise of more exciting designs.
What was once a budget Romanian brand, under its acquisition and subsequent sales success with 7.5mn cars sold in 18 years and now ranks third in Europe for private buyer new car sales. Dacia was included in the Renault Group the tongue-twistingly named Renaulution that was unveiled in January 2021 by setting firm business goals four brands – Renault, Dacia, Alpine and Mobilize.
I asked Denis Le Vot, Executive Vice-President, and CEO of Dacia Brand how closely will Dacia’s business model follow the Renault Group’s financial restructuring plan announced in January 2021? “The Renaulution plan, presented on January 14, 2021, establishes four strong brands with complementary positioning. The aim of this plan is to give greater strength to the brands. Each brand has its own territory, expertise, and mission. Renault, the latest in modern car manufacturers, leading the EV market; Dacia, leader in accessible mobility, the brand built on essentials; Alpine, the iconic brand that embodies sporting excellence and passion; Mobilize, the transition towards new mobility and new services.”
Is Dacia’s core afforable mantra at odds with this? “Dacia’s strategy remains in line with this plan,” continues Le Vot, “Dacia is the brand that offers the best value for money, the brand that constantly redefines the essentials. This positioning has proven successful in 2022 as Dacia has been growing its volumes in Europe by almost 10% in a decreasing market. In the coming years, Dacia will go further by bringing to the C segment (Europe’s biggest segment) the values and qualities that have made the brand successful in the B segment.
As the Paris presentation leaned heavily on design directions I asked if traditional advertising and marketing remain focal media platforms for the Dacia brand and will social media play a large part in attracting new demographics of buyers? “The success of Dacia in Europe in the last two decades has been based on our ability to maintain our best value-for-money proposition. Strong conquest rates, as well as class-leading customer loyalty rates, have enabled us to keep our marketing expenses to low levels with CPUs (cost per unit) among the lowest in the industry and marketing expenses concentrated on the development of the awareness of our pillar models. As Dacia is upgrading its brand positioning, launching new strong products, and preparing its C-SUV segment offensive, our marketing expenses will evolve qualitatively, though not quantitatively in order to keep our lean business model. The no/low discount policy and the reduced commercial diversity facilitate the digital presentation of Dacia models and offers. We can actually trace a quarter of our European sales to a customer digital lead, and we plan to push further this approach with improved digital tools and digital media expenses. Social media are part of this strategy as they enable Dacia to fully express its specific tone and style. To illustrate, the 2021 launch of the 100% electric Dacia Spring included a collaboration with the Rocket League game with a significant relay on social media.”
Is Dacia planning any new marketing incentives? “New marketing initiatives include brand-dedicated actions, like the complete redefinition of our partnership approach around outdoor activities and the development of our CSR activities focused around favoring access to mobility.”
As the EU’s fleet emissions targets of 95g CO2 loom large how will Dacia offset this with the fleet’s primarily ICE-engined cars within the next 2 years? “The Dacia brand has asserted a strategy based on 3 markers: Essential but Cool, Robust & Outdoor, and Eco-smart. Eco-smart has two dimensions: economic and ecological. Dacia is already committed to offer the most virtuous mobility possible. Electric and LPG ECO-G versions accounted for almost half of all orders in the first half of 2022, reflecting Dacia’s push to advocate for a smarter way of consuming automobiles. Dacia Spring, the 100% electric city car, continues to make electric mobility accessible to all with an average of more than 5,000 orders per month for the first half of the year. Spring is on the podium for all-electric retail passenger cars in Europe. Jogger HEV will be launched in early 2023 and will be the lightest and most affordable seven-seaters. Dacia is working to reduce CO2 emissions, but also has a global approach to limiting the exploitation of the planet’s resources. This is part of the brand’s global approach.”
When should consumers expect to see Dacia existing as a fully non-ICE engined car manufacturer? “The Renault Group’s electrification strategy is led by the Renault brand as the front-runner. The positioning is clear. Renault Group is investing massively in all the EV technologies that at one point in time will be used by the Dacia brand, the Dacia way. Today, Dacia is a champion of low-carbon ICE mobility with LPG, as well as accessible BEV mobility with Spring. LPG and Spring represent 48% of Dacia orders in 2022 in Europe. In 2023 Dacia will introduce its first E-TECH hybrid on Jogger.”
At the briefing, Dacia unveiled its Manifesto concept that shares fewer design elements with the Dacia cars we know revealing a rugged doorless, roofless dune buggy that drove off a Mad Max movie series film lot. The body is manufactured from recycled materials including polypropylene and inside the cabin, even cork is used on the dashboard.
Dacia unsurprisingly uses socially woke words like “cool” and “outdoor activities” to underscore the Manifesto’s design purpose – this view was made clear by David Durand, Dacia’s Design Director.“At Dacia, we like to keep it real. As we were developing and exploring new ideas, we felt we needed to push them past 3D simulations and see what they look like in real life! As well as being a designer object, Manifesto Concept encapsulates our vision and combines a wide range of innovations – some involve extreme implementation, but they are still affordable for customers. We will be using a few of them on future Dacia models.”
Objectively the Manifesto concept is a marker for the certain design elements that will flow down into the brand’s core models. Yet to dismiss Dacia as getting too far ahead of itself is foolhardy when we assess how far it has come in such a short time. Only the most cynical would bet against this singularly inclusive and affordable continued brand’s rise in the near to immediate term future.