Asymcar 19: About that Ferrari SUV…

Ferrari FinIn today’s show, Brand managers gone wild!

In other words, why would a brand be smeared all over a set of jobs that it would never be hired to do? What motivates a company to destroy its brand?

We start with Mini’s plans to sell 100,000 cars in the States by 2020, nearly double today’s pace and remember how Cadillac destroyed their brand and how Mercedes, Porsche, Ferrari et. al. can’t wait to do the same.

Also, might retail power in the form of strong dealer regulation limit brand’s ability to improve or address customer experiences? What motivated Warren Buffett to enter the American car dealer business? (With a long aside on what Buffett investment logic is all about and why it’s not  contradictory to a growth investor).

We detour a bit into the information battle to come and how car makers yearn to “be the masters of their own cars”.

30mb mp3 about 61 minutes.

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Notes:

Mercedes, VW to Thwart Google’s Inroads in Car Data.

Ford CEO Mark Fields One Ford Strategy.

My tips to Warren Buffett in his new career as a car dealer.

Mini’s Sales Slump.

Ferrari Strategy Conflict.

Car sharing: A cheaper alternative to owning a car in the city

Kleemann Mercedes “Supercars”.

Corvair Greenbriar.

Mercedes Smart Car

“it is clear to us that Ferrari has been undershooting its market potential.”

  • abdoradus

    Keeping the brand pure is all good and well but niche brands haven’t done very well of late. It takes a lot of engineering manpower to design a modern car. You have to sell a certain volume to pay for that. Even a fairly large operation like GM’s European business (Opel/Vauxhall) can’t sustain its design center with the sales they make. They have to hire it out to other GM brands. The cost of tooling the factory is large, too. That’s why the Smart never saw a serious redesign until very recently. Mercedes sold enough units to make the running production profitable but not enough t recover the money the had spent upfront. The new model is a joint venture with Renault.

  • calvini

    An example of a company that is niche is the struggling Aston Martin. It can be said that they take care of the brand is Aston Martin and they have a limited production (no SUV yet). However, the volume is not enough to maintain the company afloat. With the demands to have less pollutant vehicles and other competitors can a company that takes of their brand really survive?

    • Oluseyi

      Well, let’s not leave the Cygnet out of our analysis! Because of the emissions regulations, Aston was forced to license the Toyota iQ small city car and rebrand it as a £31,000 “entry model.”

      They sold 89 of them.

      Of course, this goes to your point: Aston merely draped it in new, lightly tweaked sheet metal and added a leather interior. No changes to engine, suspension, transmission… So of course consumers didn’t consider it worthwhile, especially when the iQ cost a mere £11,000.

      Worse, Jaguar is resurgent, with a broader product range that’s easier to tell apart and real excitement about the brand thanks to the F-Type. So, yeah, bad time to be Aston Martin.

      • calvini

        Forgot about that little but huge mistake. You’re right about Jaguar. I like what new management is doing, but history is not on their side. All these British automakers have only been a financial bleeding for whoever own them.

  • Sam McDonald

    What was the title of the roads book Horace mentioned?

    • http://asymobi.tumblr.com/ Oliver Bruce

      Big Roads by Earl Swift.

      • Sam McDonald

        Thanks Oliver!