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Holden - Wheels Report 2016

By Toby Hagon, 24 Jan 2017 Wheels-Report

Holden - Wheels Report 2016

An underwhelming year for Holden on the sales front, down eight percent, largely due to old models (Cruze, Captiva and Barina) that lack showroom sizzle, and substance.

An underwhelming year for Holden on the sales front, down eight percent, largely due to old models (Holden Cruze, Captiva and Barina) that lack showroom sizzle, and substance.

At least Holden Commodore continued with much-needed strength in what is still a sizeable large-car segment. But it was a year of consolidation for Holden as it began to introduce the new breed of imports that will define the company over coming years. The impressive little Spark arrived early, but new micro cars never translate into big numbers.

Similarly, a heavily revised Colorado boosted profits and reputation but only tickled sales. The recently arrived Astra heralds a return to Holden’s small-car glory days with great dynamics and drivetrains, albeit with pricing that pits it against classy segment leaders. The result will leave Holden in fourth – its worst on record.

RANK 4TH
2016 SALES: 96K
2016 YTD RESULTS: 86,583 sales, down 7.7%, 8.0% market share
2017 FORECAST: 100K
RANKING: 4th; 100,000 sales (up 3%), 8.3% market share
GRADE: B-

Opportunities

Holden Astra and Equinox (arriving late in the year) are the big hopes for Holden in 2017. Both are new and arrive in two of the biggest segments, offering opportunity for growth. However, Holden’s focus is also on sustainable profits, which means we’re unlikely to see prices matching the bargain cars in those respective segments. Throw in an updated Trax (same underneath but with a redesigned snout and nicer interior) and for much of 2017 the brand will have fresh metal in segments that count. Holden also needs momentum from the updated Colorado, which can now fight with the big boys. Expect Commodore sales to dip (production numbers have already been set) but still be healthy. Interest in the last Aussie muscle cars will deliver healthy V8 demand.

Challenges

2017 will arguably be the toughest in Holden’s 69 years. The Elizabeth production line shuts down late in the year, consuming some brainspace of top brass, and there are still holes in the line-up, such as the large seven-seat SUV category dominated by the likes of Hyundai, Toyota and Mazda. Holden also has plenty of work to do with young buyers, who don’t care about the brand’s history – and, subsequently, don’t buy many of its cars. Holden has to accept it’s now a challenger brand rather than the powerhouse it once was.

Summary

Holden is trying to mimic the successful ‘premium’ model of Mazda and VW, but the brand image is tarnished and will require TLC – and new-model muscle – to enjoy genuine success. That will take a lot longer than 12 months.