Struggles of the secondary car brands in Asia

In Asia the automotive market is relatively sterile with the usual few car companies dominating the top sales figures. Companies like Toyota, Honda, Nissan, Mercedes, BMW and Mazda do well but secondary brands that are quite prominent in other countries such as Kia, Hyundai, Renault, Ford, Citroen, Ssangyong, Peugeot, Volvo, Alfa Romeo and Fiat all struggle in Asia.

VW was omitted from the list because at one time it managed decent sales figures in Malaysia and Singapore but due to their poor reliability record their sales have taken a big beating and the consumer confidence have really eroded.

Brands like Kia, Hyundai, Renault, Citroen and Peugeot struggle to gain consumer confidence. The reasons vary for each car company. Kia struggled due to poor marketing and insufficient after sales support, Hyundai struggle due to outdated models that need urgent replacement. Citroen and Peugeot suffered from poor reliability image and this in turn also cause their resale value to drop tremendously. The distributor often do not stock sufficient spare parts which cause frustration with customers facing problems with their cars.

Ford's problem is the poor models selection. The main selling model is the Ranger pick up truck. The other models did not appeal to buyers and seem outdated in their design compared to the Japanese rivals. The Ford models appealed more to the Americans and didn't suit Asian buyers' tastes.

all of these brands have been in Asia for decades but cannot seem to grow their presence. Mazda at one time was in this predicament but with the models and aggressive pricing strategy Mazda managed to grow significantly over the years and have now created good customer base.

In order for secondary brands to do well in Asia they need to have a very solid foundation for sales and after sales support. The distributor needs to provide sufficient spare parts and create a customer buy back program to instil confidence that the car's value will not depreciate much more than Japanese rivals. With strong after sales support it will reduce the level of value depreciation and gradually new customers will be attracted to the brand.

In recent years Volvo have managed to turn around their business in Asia with their aggressive hybrid campaign which has been paying off. The new XC90 and the S90 models are gaining popularity and this has spurred more new buyers to consider Volvo. The dealership network has also expanded which helps with customer confidence.

Turning around the brand in Asia is not impossible but the distributors need to employ the right strategy to  make it work for them. It also depends on how much the distributors are willing to invest to promote and market the brands.