Paul Barker grabs a cuppa and a chat with one of fleet’s most influential figures – Alain Descat, Managing Director, DS Automobiles UK
PSA Groupe’s premium brand DS is gearing up for growth with a new model launch per year for the next few years. The momentum began with 2018’s DS 7 Crossback and will continue with the imminent DS 3 Crossback, followed by a plug-in or full electric version of the two models respectively. All of which should help the fledgling brand begin to establish itself in the UK marketplace.
QWhat sort of state is the DS brand in right now? You’ve said sales have picked up, so where is the brand compared to where you hoped it would be?
Overall, we are on track with our roadmap. Last year was a transition year for us. We logged the first DS 7, the first ‘new’ [generation] car, we also separated the dealer network from Citroen’s; as of July we had to create this rupture from the past, which directly affected the sales volumes. We took the hard decision in terms of volume to let 150 Citroen dealers go and to bring in 25 retailers in July; now we are up to 35.
POSITION OF PRIVILEGE
In an attempt to push DS’s premium brand status, the company is developing its DS Club Privilege, a series of offers and benefits that run through its MyDS app.
“If you buy a DS you will be registered to Club Privilege, and within your app you will be able to see the events that are on offer to you,” says DS Automobiles’ UK boss Alain Descat, citing a recent tie-up with Kew Gardens as one example.
“Some of them are events where we offer tickets – a concert or exhibition, some are bespoke; we have created a distillery visit, a cookery experience, a wine tasting. We have events every month in different parts of the country, and then we offer them on first-come, first-served basis. You can book yourself on to the event.”
It also extends to discounts through tie-ups with high-end brands in food, fashion and chocolates for example.
“We are trying to give a bit more context, to create an environment which fits the brand and extend the experience,” Descat tells Company Car Today. “We keep on adding events and partners to it, so there is progress.”
QHow have the DS 7 Crossback sales gone from a fleet perspective in its first 12 months?
I think it has gone quite well, especially at the end of last year and beginning of this year. We have managed to be more targeted towards the small or medium companies through our dealer network, and we have seen some quite good progress. So when we are saying sales of DS 7 are growing, they are now growing strongly within the contract hire channel, which for us is very important. For instance, we have a lot of van owners within the PSA Groupe [across Citroen, Peugeot and Vauxhall]; on the driveway they have a premium car and so now we have an alternative for them, whatever they are driving.
We have also made progress with training our customer advisers to take on part of the relationship with the SMEs. With DS being a standalone brand, we have decided to empower this expert adviser in the showroom to be more competent in understanding how to do contract hire, what are the implications for a business owner and how they should approach the use of the car, the type of solutions we have. This has been quite a success because they understood that there was potential there and now we are starting to see more traction in the fleet area.
Another of the things we have done well is managing the residual values, so we have seen the RV of DS 7 Crossback growing significantly month-on-month.
QHow are you managing to make that happen?
I think there is a bit of the market being conservative [with the DS brand], and we have been able to control the transaction price of the used cars because we have only distributed or remarketed the cars through our dealer network, we have controlled the car so that we haven’t pushed big volumes. The RV improvement has allowed us to improve the monthly rental figure, which in turn helps us to be more competitive in terms of pricing. The basics of building a brand for the future are there. We have got a stronger basis and the volumes are starting to grow as awareness is growing. What’s blocking the volumes is simply the awareness, and the fact that we don’t have national coverage; 35 is still not full coverage so there are areas of the country where we are too far from customers.
QIs there a typical DS customer, in your experience?
I couldn’t portray you a typical DS 7 Crossback customer. Obviously, they come from Citroen, but we have had people trade in Range Rovers and Porsches, and even a few Lamborghinis, and at the same time we have traded in Nissan Qashqais, Renault Scenics, cars from the mainstream. We have got customers from a lot of different backgrounds, but one thing that is common with them is that they are curious about the brand, and they are totally enthused by the product. That was the pillar in discovering what DS 7 Crossback had to offer in terms of product content; high specs for what is still a reasonable price; it’s a premium price but sits well in the market. The feedback, and I have talked to a lot of customers, is always that they feel different, feel a bit unique having a DS. They appreciate the fact that not everybody drives one.
QHave you seen the quantity of fleet business rise?
Yes, now SMEs are starting to rise. What we lack is awareness of the brand, if you want to be in the shopping basket of a user-chooser or company, our main hurdle today is that people do not know DS is an option for them. We are confident that the more people know it, the more people can test drive it, we get them on board with us.
QHow will the DS 3 Crossback sit from a volume point of view, and how important is it to DS?
We have got great expectations for DS 3 Crossback. It is important now because DS 3 [hatch] is on the way out, production stops in May. We are at the point where the first generation – born Citroen – is now leaving us with a great history, at least as far as DS 3 is concerned. So it’s emotional in some ways to let this car go, but now DS 7 is taking a bigger role, we have already sold 500 this year, but we won’t sell 10,000. So DS 3 Crossback is important. It will be more, but in terms of volume, I don’t know yet to be honest. Obviously it will be more than the DS 7 Crossback, but where to put the bar, I couldn’t tell you.
QHow will you position DS 3 Crossback, since it’s not a direct replacement for the successful DS 3 hatch?
That’s one of the main questions – DS 3 Crossback doesn’t renew DS 3, it’s not the new DS 3, it’s a different proposition. Yet I believe a fair proportion of DS 3 customers will move over. I don’t know if it will be 15% or 50%, but we know there is a lot of interest from our DS 3 customer base. We also know that there is a price gap, although thanks to the good RV, we can offer a good monthly rental price to customers, which will enable us to close part of the gap to DS 3 Crossback. So, I think we will be ready to take a share of DS 3 customers into DS 3 Crossback.
But the main topic for me is to conquest new customers. I live in London and see all those Minis everywhere, I know there is a market for a fun, premium, small SUV. People turn to an SUV because of the comfort, because of the high driving position, the status it gives them, and I think we’ve got a cracking SUV.
The electric DS 3 E-Tense
“The more we go on, the more I think it could take a bigger share. We have seen 25% of the hand raisers online indicate about the E-Tense version. I don’t know if this will reflect in sales, but I’m sure a fair percentage of them will make the move. There is no other option as a full electric car in the B-SUV segment, there simply isn’t one.”