US car icons struggle to cross the Atlantic

US car icons struggle to cross Atlantic

Much is made of the “special relationship” between the US and UK but that relationship does not always extend to the car industry.

Some of America’s best-selling and most iconic marques have struggled to replicate their domestic success in Britain. Cadillac and Corvette’s decision to scale back their UK office after less than two years (MW last week) gives further credence to the view that US brands are fighting a lost cause on this side of the Atlantic.

Many industry experts are now asking why they continue to try to crack the UK and European markets. Former Toyota GB commercial director Mike Moran, who now runs consultancy The Automotive Partnership, says: “There is just something very different about US car design and consumers notice the difference. The cars don’t particularly appeal to them.”

Failure to launch
General Motors launched Cadillac – its flagship brand in the US – in Europe two years ago (MW November 25, 2004) but began a review of its European marketing strategy this summer after just 500 of its new BLS saloons were sold in the first two months it was available. The company admitted at the time that sales had been “slower than expected” but said it was still aiming to sell 7,000 Cadillacs and Corvettes in Europe next year and 20,000 by 2010. However, it had only sold 3,949 cars by the end of October and, despite this being an increase of about 20% on the same period last year, the company still appears to be some way off achieving those targets.

Former Volvo marketer Malcolm Wade was appointed to launch Cadillac and Corvette in the UK in April last year (MW April 14, 2005) and DaimlerChrysler retail marketing director Alastair Welham was brought in as head of marketing three months later. But Cadillac decided not to replace them when they both resigned, meaning UK distributor Pendragon now works directly with the company’s management in Holland.

It has proved harder than expected to get Europe’s luxury car buyers to switch from BMW and Mercedes, the world’s biggest selling luxury marques. Wade, who is now group managing director at motorbike clothing and accessories company Lloyd Lifestyle, says the situation is a “mess”.

“The Americans didn’t realise the investment needed to launch a US brand in Europe and they don’t understand that we’re not the United States of Europe,” he adds. “Europeans don’t want four-litre petrol engines.”

Chevrolet, which launched in Europe at the end of 2004 (MW March 18, 2004), has also found this continent a tough nut to crack.

But Professor Garel Rhys, director of the Institute of Automotive Industry Research, says: “When you look at the top-of-the-range marques that Cadillac is taking on, they are some of the strongest brands in the world motor industry. But Chevrolet is different. It’s operating at the bread-and-butter end of the market, so I think it’s much more likely to succeed.”

Hanging in there
Moran believes Cadillac not replacing its managing director and marketing chief is a negative move and says the only way it will succeed in Europe is by “toughing it out and building some brand resonance” as brands from the Far East, such as Kia and Hyundai, have done.

But Wade thinks the attitude of US car companies must change. “There’s a belief that people want it because it’s a Cadillac. They don’t understand and don’t want to understand the European consumer. We have different attitudes and customs and cultures. They need to understand that before they can be successful here.”

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