Low cost: the new automotive Holy Grail

Low cost: the new automotive Holy Grail
Low cost: the new automotive Holy Grail

The marketing managers of major manufacturers are modest people. Thus, there are terms which have completely disappeared from their vocabulary, such as that of « low cost ». Afraid of offending customers who don’t necessarily want to be treated as buyers of a car at a discount?

Very certainly, but for all that, like Dacia which claimed this term for years, the low cost brand of the Renault group was already the cash machine of the house that it still is today, even if it has abandonedwe use a pseudo-infamous nickname to become best value-for-money (best quality price report).

Twenty years of riding alone

However, the undeniable Franco-Romanian success since the Logan of 2004 has had little to no competition. Twenty years of going it alone, an exceptional loyalty rate and profitability which is just as exceptional could have given rise to putsch attempts to steal the envied place of queen of large volumes. Nothing happened, apart from an attempt by Fiat, which, with its Tipo, arrived in 2016 at 12,490 euros, a great price for a compact. Alas, she is finishing her modest career with 5,000 euros more.

Industrially complicated to make profitable, low cost has been abandoned by all manufacturers who, in recent years have had only one word on their lips: premium. From Peugeot to Renault, via Skoda and Volkswagen, all brands have jumped into this new, very practical hobby. Damn, but that’s for sure: by manufacturing high-end models (or those that look like them), we sell them more expensively, and we multiply the margins. As obvious as rain or shine.

Except that these new “premium” cars have to be sold. A premium brand takes time to establish itself in the hearts of customers and their wallets. You only have to look at the career of a brand like Audi to see that it took it twenty years to become part of the premium landscape.

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The Citroën C3 Aircross: the first real rival of the Dacia Duster.

And then the high-end cake is not expandable. The number of executives (individual or corporate clients) does not exceed 15% and is not growing, unlike the number of brands trying to attract them.

Adieu premium, bonjour low cost

So the manufacturers are changing their tune and looking again towards Dacia and this famous low cost which does not mean its name. And it’s Citroën which gets the ball rolling with its new C3 Aircross. After searching for a good decade, the chevron brand finally seems to know which foot to dance on: that of the inexpensive car, whether thermal or electric with the e-C3.

Fiat Grande Panda, perhaps Dacia’s other future competitor

The large C5X sedan is abandoned so as not to blur the image and its small SUV attacks the Dacia Duster head-on, modeling its entry-level price on that of the Romanian to be a little less expensive. The Citroën costs exactly 290 euros less, out of pure provocation and to explain to Dacia that it is no longer alone in the world.

But the offensive will not stop there. The inexpensive Stellantis platform called STLA Smart car will also be used by Fiat for the future Grande Panda and we can predict that it will not be “premium”. So, the manufacturers would have understood that their customers do not all live in a wonderful world where we spend, without any problem, 30,000 euros for a city car. Who would’ve believed that.

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