The auto maker’s Entry Range lineup has taken off worldwide, but branding of some cars is confusing and inconsistent. Also in need of sorting out is a premium-car strategy.
Renault’s Stoll with Logan wagon in Geneva.
GENEVA –’s international growth may lead it to change the names of some models that are sold as a Dacia in Europe and Renault in the rest of the world.
“One day or another, it is clear that we will have to split a little bit more the names and not have the same model name with two different brands, which could (cause) some confusion with the Internet,” Jerome Stoll, executive vice president-sales and marketing, says in an interview with WardsAuto.
Dacia began in 2004 as’s regional subsidiary to sell low-cost cars in Eastern Europe, but demand for basic-transportation vehicles soared both in Europe and in the new markets Renault wanted to conquer under its own brand name.
Sales outside Europe topped 50% of Renault Group volume last year, thanks to 9.1% growth outside Europe and an 18% decline in its home markets. Renault’s Entry Range cars made up about 37% of the group’s sales in 2012, and they are a profit engine for the company.
“The Entry Range is certainly the most profitable in the industry today,” CEO Carlos Ghosn said a year ago. “Our objective was 6%, and nobody believed you could make a 6% profit at the entry level, but today our profits are much higher.”
Production of Entry Range cars last year totaled 976,848 units, says Jean-Michel Prillieux of the Inovev consultancy in Paris, who predicts output will grow 11% this year as a Renault factory in Tangier, Morocco, comes up to speed.
The auto maker’s strategy is to treat Renault as a global brand, Dacia as a regional brand and Renault Samsung Motors as a local brand in South Korea only.
Products inspired within the countries served can end up elsewhere, however. For example, Dacia aimed its Sandero at Brazil and Duster at Russia, but both are big sellers in Europe, as well. The Koleos made by Renault Samsung is Renault’s biggest seller in Russia, and the Latitude that comes from South Korea is Renault’s big sedan in many emerging markets, though few are sold at home.
Renaults are offered in 96 markets around the world, according to a recent Renault-company blog, and the cars with the same name can differ significantly.
“The Duster in Brazil and Europe and India is not exactly the same car,” says Stoll. The Brazil Duster has a different dashboard, and the version in India has a device to pump air conditioning to the rear seats, something not available in Europe.
Each market can offer different vehicles. Argentina and Russia both sell the Koleos, Kangoo, Logan, Megane, Sandero, Fluence, Latitude and Duster, but Argentina also has the new Clio and the Symbol, a sedan based on the Logan. Russia also markets the Scenic and Laguna.
And there are cars such as the Renault Symbol 4-door sedan, which also is sold in some markets as the Renault Thalia. In 2012 a third-generation Symbol was launched at the Istanbul auto show, although some markets still sell earlier versions.
To maintain the Renault brand at the same level in its different markets, despite different local conditions, Stoll relies on country and regional managers to ensure the brand rests on four pillars: quality, environment and fuel efficiency, design and innovation.
Without quality, the brand would be dead, he says. Protecting the environment and reducing carbon-dioxide emissions means Renault is part of the solution to problems caused by the auto industry, and in every market customers want to save fuel.
Innovation for Renault means ideas that make life easier for customers, such as technology that’s affordable and features such as the removable seat covers on the new Renault Captur.
Design is important, Stoll says, because “if your design is ugly, you can be sure of the result.”
Designers not only must create “a beautiful car, but also communicate…the values of the brand” and support the brand itself, he says.
“Anytime you launch a new car that has nothing to do with the previous one, you are losing your customers, because your customers do not recognize the brand. They may recognize the model, but they do not recognize the brand.”
Chief designer Laurens van den Acker was hired three years ago to put a common face on all Renaults, which already has arrived on the restyled Twingo, Clio, Captur and Zoe. In addition, the new Logan has the Renault face where it is sold by Renault and a Dacia face in Europe.
The Entry Range is successful, Stoll says, because it has low-cost engineering that relies on parts and modules that already have been amortized; is built in countries such as Romania and Morocco with low labor costs; and is distributed with a one-price approach that appeals to individual buyers.
Other auto makers have a hard time putting all three elements together, meaning there is no real competition for the Entry Range, Stoll says.
“This offer corresponds to the situation in Europe, where there is a crisis,” he says. “And it corresponds as well to emerging markets, where people want to buy a car and they cannot afford it. This part of the market is addressed.”
Beyond Entry, Renault is working on finding niches and moving upscale.
“Is there room in the market for another car that looks like the others, a generalist? I think this part of the market is shrinking,” Stoll says. “We want to find the proper niche or segment where the customer actually is.”
For the moment, Renault is pushing personalization, which Stoll considers to be a major market trend.
“When you look at Captur, for instance, the customer can define the paint on the exterior and the interior and some equipment that fits his request. The customer wants to buy his own car.”
As far as the upper range goes, Stoll says work is under way on solving the equation.
While the Dacia brand targets entry-level buyers in Europe, freeing the Renault brand to move upscale, the weight of Entry Range sales in other world markets raises questions about the potential breadth of the brand.
and moved upscale by launching Lexus and Infiniti. What has not worked well in the past for brands such as Renault and is to push to the same heights. No matter how much some reviewers liked them, the Renault Avantime, Renault Vel Satis and Volkswagen Phaeton were commercial failures.
“The upper range, is it by size, by segment?” asks Stoll. “We are working on that. We have a kind of label already with Initiale (luxury trim line). We are going to see whether we can define more precisely what the upper range of Renault might be, and how to address it more appropriately.”
And, he says, “There are other niches on which we can work, like Renault Sport Technologies with the Clio RS…and we have the EV which is a different kind of mobility. The fragmentation of the market is to be addressed in different ways…segment by segment or cluster of customers by cluster of customers.”