New Vivaro due soon

In the last year Ian Hucker has added commercial vehicles to his responsibilities at Opel and is now director of European fleet and commercial vehicles. It’s an area he is familiar with having been responsible for Vauxhall’s commercial vehicle operations around the time that the current Vivaro van was launched. Now he will be very much involved with the launch of the replacement model.

‘Back in those days we were trying to establish ourselves in the medium van segment, but now we’re coming from a very different position. Vivaro has performed stunningly well. Especially over the last year, where it’s grown segment share year over year and is now running at 10% of the segment across Europe, which is a record high in the last year of its life.’

Vivaro is built in a joint venture with Renault and the GM production plant in the UK was until last year where most Vivaro models, as well as the Renault Trafic and Nissan Primastar were produced. The joint venture continues, but the two companies will now be producing most models in their own plants.

The Luton plant will build most Opel and Vauxhall variants, which could help the company to increase penetration of the medium van segment, ‘There are benefits on a number of levels in having your own facility.

We’ve always benefited from the flexibility and responsiveness from the team there, particularly on the fleet business where our customers rarely want the standard vehicle.

There’s always something that needs doing as part of the modification process.

‘The fact that we centralise production of the majority of our variants at the Luton plant also helps us as we start to expand into Eastern Europe and develop new CV markets beyond our traditional Western European.’

'We take well-surfaced roads for granted in Western Europe, but expanding into other markets where that is not always the case presents challenges for any manufacturer.'

Adding equipment so that vans can deal effectively with poor surfaces adds cost.

‘We hadn’t quite got our cost base right on that one, but going forward with the new product, we’re going to be more competitive in that area. The core of our business will still be Western and Central Europe and we still have upside potential in those markets. We’ve risen up the league tables with the position of Vivaro but we can still go further. The benefits of the new product, especially the cab environment is light years away from the previous generation.

'While the load compartment is longer, the mounting points for example are all carried over, so if you’re using a racking system in the Vivaro today, you can quickly fit it into the new product and re-use it, which is increasingly what fleet customers are doing anyway.’

Heavy investment is now going into business to business development programmes, particularly aimed at the small business user in central and eastern Europe for the Vivaro, involving dealer programmes and people on the road to promote B2B. It is always harder to approach thousands of smaller customers than several large multinational clients. Opel is also launching some new aftersales programmes.

'The Flexcare programme, for example, allows a business to business customer to choose what elements are important from an aftersales package and work the parameters around their parameters, the loan duration, the mileage and then we can provide a package price that gives total peace of mind.’

Positive signs of recovery

Flexcare is also available to B2B car customers.

‘That’s where Flexcare or a financial product can bring that same total managed cost of ownership that corporations have to a business or business user.’

Distinguishing between large and small fleets can present a challenge.

‘It depends on the market,’ says Mr Hucker. ‘Whereas in the UK and quite a few other Western markets, you would say small was below 25, as you push further east, 25 could be a pretty decent fleet. It’s effectively a purchase that’s being made in a non-retail way, so it could be one car, it could be 10 cars, or it could be a mix of cars and vans.’

The Western European market now seems to be gradually returning to growth. Understandably, Opel/Vauxhall is taking a cautious approach.

‘For our planning purposes, that is the right approach,’ says Mr Hucker. ‘We want our business plans to be based on very firm foundations. But we are seeing some positive signs of recovery in a number of markets. Conversely, Russia has been under pressure since the start of the year and so has Turkey with political issues being experienced there that have had an impact on the size of the new car market. When you look at Europe as a whole you probably see a more stable position, but within it there are quite some ups and downs.

‘When you look back at our 2013 performance, we did increase market share in Europe year over year, which was the first time in 14 years. So that’s a very significant achievement to really move it in the positive direction and the plan is obviously to continue to deliver growth.’

Astra is generally Opel’s core product, but Mr Hucker has seen resurgence in interest elsewhere. ‘I think we’re enormously encouraged by the development of new Insignia. Crucially for fleet, it has the 98g/km engine, so not just a niche engine, but on the regular 2.0-litre 120hp and 140hp diesel, the powertrain that a fleet customer is going to pick. We are also launching business editions. The UK has had it for some time with Tech Line, but other markets had not historically had that type of execution – having an attractive list price to reduce the tax burden for the user chooser.

'That concept of having a specification that’s tuned for the user chooser, priced with the Benefit-in-Kind systems in mind, 98g/km CO2 emissions and the new infotainment system etc. That as a combination has really worked. Tech Line in the UK took some time to build awareness and get it established in the fleets. 50% of our orders from launch in Germany were business edition. They’re now working on a second version of that that caters for the higher end, aimed at the higher end user chooser, with a lot more specification but a similar concept.’