PSA Group is to withdraw its DS cars from Citroën showrooms, as it aims to build DS its own smaller, distinct sales experience.
The company hopes the move will revive the struggling brand; sales are expected to fall for the fifth year in a row in 2017, though a recovery is predicted in 2018 when new vehicles and the new sales network will launch.
Although many will be co-located with Citroën dealerships, the new DS showrooms will have their own dedicated sales staff, distinct spaces and décor schemes.
PSA Group is hoping sales will improve with DS having access to a more exclusive network, even though it will be on a much smaller scale. The number of DS-only showrooms will rise from 111 today to 500 by mid-2018, when the cars will no longer appear in Citroën’s 5,000 outlets. PSA Group insists it is still very early days for DS, though it is still confident that it can position the marque to become the Group's luxury brand. DS is counting on new models in the popular crossover SUV category to revive its prospects, with a mid-sized SUV set to be unveiled in the coming months. PSA Group will also use the DS brand for its first rechargeable hybrid in 2019; perhaps the brand will see greater success in the electric category.
‘Transitions are never comfortable,’ said DS brand chief Yves Bonnefont in an interview with Reuters. ‘We see volumes continuing to weaken in 2017.’
This surprisingly open concession reflects poor sales figures that have been declining steadily since 2012 from a peak of 129,000 vehicles. DS was originally launched as a sub-brand of Citroën in 2010, as a salute to the 1955 DS limousine reminiscent of General Charles de Gaulle and Nouvelle Vague cinema. The Citroën insignia was removed from European DS models in 2015. Last year sales declined by a further 16% to 86,000 units globally, and DS car registrations fell by 12.8% in western Europe in 2016, according to ACEA data.
DS is seeing big problems in both of its main markets – Europe and China. In China, where DS was marketed separately from Citroën from the outset, sales collapsed by 25% to 16,000 last year, leaving the brand in 62nd place in the market. PSA Group’s joint Chinese venture CAPSA has a near-new plant there producing only small numbers of DS vehicles. The only major brands with lower sales figures were Fiat, which crashed by 60% to about 12,700 units last year and Jaguar, with 5,600 units.
Bonnefont added: ‘When you bring the products together in an environment that offers customers a real experience of the brand, we've seen that the sales dynamic is there.’
Decoupling the DS brand from PSA Group’s volume brands is a wise move, that will allow it to better develop its own identity and price trajectory. However, one of the major causes of the collapse of DS sales in Europe has been PSA Group’s decision to release a facelift of the DS3 instead of an entirely new model. The DS3 had already received its first facelift in May 2014. It is yet to be seen whether PSA Group is willing to invest sufficiently to change consumer perceptions of French cars and establish an expensive premium model brand.
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