Geely launches in UK, Robert Forrester hits out at 'Motability tax', and how quickly should a dealer answer the phone? - with Nic Thomas, episode 228

The Cardiola podcast is sponsored by Auto Trader. John, do you know why I, like nearly 14,000 other dealers, work with Auto Trader?

No, but I have a feeling you're going to tell me.

Well, with around 84 million consumer visits each month, it connects us with more engaged car buyers than anyone else in the UK.

And there's the ability to reserve cars when the dealership is closed.

Ah, so you can stick to your strict 8pm bedtime.

Exactly. And the Auto Trader team are always on hand to offer their insights, ensure we get the very best from our package, and ultimately sell more cars.

Well, that's good, because you are going to need all the help you can get.

Oi, less of that.

Dealers, if you want to find out more, log on to trade.autotrader.co.uk

Welcome back to the Cardiola podcast, where we pick our favourite stories of the week and ask an industry guest to choose which were the best.

I'm John Ray, and joining me this week is two-wheeled holiday maker, James Bagot.

James, you're back.

I'm back. I'm back. And I've been joined by John with a whole new look.

I mean, this is fascinating. I can see that you've now brought a hat to the party for those people listening on audio.

You won't know what John's hat looks like. But I mean, let me just describe it to you.

He looks like a very young baseball player who might be on the side of a road somewhere.

What is it? What is it, John? Tell me what's going on with the hat.

You're trying to say I'm a road man.

That's what I was trying to say.

Right. OK. I understand now.

You've never worn a hat. Where's the hat come from?

Well, I haven't done my hair this morning. And as you will know, James, this is a visual medium now, our podcast.

And I have to do something to cover it up.

So I've chosen the 1599 Zara hat to do so.

Thank you for asking.

I'll try and not let it put me off, but it has done so far.

Nice to see you, John.

How was your holiday?

Well, I mean, there's nothing more boring, is there, than people talking about their holidays.

You're right.

But yes, no, it was very nice.

Thanks, John, apart from apart from the fact that I think you covered it last week.

But basically, I got back to my bike on the first day of the trip up before 1600 miles with you under the wheels to find that it had been pushed over by someone.

So it, yeah, I thought that I'd just been a little bit unlucky.

Hit and run, someone knocked over my motorbike and drove off slightly annoyed, as you can imagine.

Slightly annoyed.

No, I can't see it.

Maybe slightly simmering and then realized 50 miles later that instead of just superficial damage,

they'd actually cracked the rocker cover on my BMW and it was leaking oil all over my foot, which was not ideal.

But unfortunately, I found a BMW dealer on the route in Leon, which is in northern France.

And amazingly, I rolled in at four o'clock on a Tuesday afternoon, just after they've got back from their siesta.

They didn't ignore my chat GPT translations.

They were incredibly helpful, ordered parts overnight by 11am the next morning.

I was driving on my way with the bike fixed.

I mean, it was just in terms of service.

It was absolutely unbelievable.

I was over the moon.

So thank you to that BMW dealer, which I cannot pronounce the name off.

So if you just Google one in Leon.

But yes, so far from that, very nice, John.

Good to be back.

Nice to be back.

Have inbox full of threatening legal letters from various companies that we've obviously had to deal with.

Can't talk about that, but proves that we're doing the job right, doesn't it?

If we're getting the legal letter from a dealer somewhere or another.

And your car sales wise, that seems to be happening.

I haven't really caught up with that.

But I think we have sold some cars.

But anyway, my news is boring because you have got some interesting news, John.

You have been on another Chinese car launch.

I have.

It's like deja vu now.

I mean, what actually was a brand launch?

So it was what I find quite funny.

There's a phrase I keep coming back to in my head, which is like when I went to the cherry launch a few weeks ago,

literally last month it was their PR person said to me,

Oh, well, it's not every day you come to a brand launch.

Is it?

I thought, well, you've had three of them now in your company.

And I suspect it's going to be some more.

So it sort of is.

But yeah, this was another brand launch.

This was Geely.

I mean, I'm sure we'll come on to this because there's sort of a story about it.

Well, it was your sub-stack, which I did to this month week.

But yeah, interesting event, interesting company.

I think they all start to blur into one a little bit, but you do see there are some differences between all these Chinese car companies,

you know, maybe not so much in the styling department or, you know, how the interiors of the cars are or what cars are like to drive probably.

But they've each they're each bringing something to the table.

And of course, what Geely brings to the table is Volvo and Polestar and Lotus and London Taxi Company or whatever they're called.

So I suppose they're they're going to try and leverage that a little bit.

They're not actually attached to Volvo dealers or anything.

They're just, I think you'll be able to say if you're a dealer, well, it's really a Volvo underneath.

It's not.

But, you know, that's the kind of a bit like, you know, Skoda dealers might go, well, it's, you know, it's Volkswagen technology under here.

It's kind of the inverse of that.

Be like a Skoda owned VW.

It's very weird.

We should probably part that, though, because we've got a very interesting Jesse.

Funny enough wants to talk to us about Chinese car brand launch.

Maybe we should just park one and move on swiftly to another.

Shall we?

Yes, I think so.

So joining us this week, I'm thrilled to say is Nick Thomas, managing director of Chang'an UK.

Nick, lovely to have you.

Good morning.

Speaking of another Chinese car company.

Nice to see you, Nick.

Sorry to sort of introduce you with the brand launch of another brand.

But very, very nice to see you.

And thank you for joining us on the podcast, because we've obviously been talking about Chinese car brands long and hard on the podcast.

They are changing the face of the automotive industry out there in the UK.

You've obviously got one of them under your stewardship, which we'll hear all about.

But I mean, firstly, before we go into that, tell people a little bit about your past and your background.

Because you've had a very interesting career in the motor trade, haven't you?

Thanks for having me.

Yeah, well, I think only people in the motor trade would call it a very interesting career.

But I've had some fun along the way.

Yeah, so I've been around forever.

I started with Ford in the UK.

Actually, I started with Ford in Eastern Europe, setting up distributors in places like Romania and Croatia in the early days of that business.

And worked my way through Ford in the UK.

Then when Russia was the next big growth market before wars and things started there,

Ford sent me off to Russia to set up their business there.

That was fascinating adventures.

I got to live in a few different countries with Ford and learn about the business, particularly in the UK.

Then I joined Nissan in about 2012, I think.

I worked my way around Europe with Nissan, so I was in their headquarters in Switzerland,

which is obviously the natural place to have a large headquarters and it's nothing to do with anything else.

And I was managing director of Austria for Nissan.

Then in the early days of electric vehicles, I went off to Japan.

And I was head of the global EV business unit for Nissan, working out of Japan for four years,

trying to launch the second generation of leaf, so not the earliest days,

but still when people looked to me and said, why on earth would you want to work in the electric vehicle department?

What have you done wrong?

And to me, it was clear it was a real growth part of the industry and a fascinating place to go and learn.

If I wanted to build my future in the industry, so I went off and did that for a few years.

Then came back to the UK with Nissan for a couple of years before I again looked at where the industry is going

and thought I'd better get on board with a Chinese car company, because as you said, there's a lot of them coming

and they're going to be a very significant part of the industry going forward.

So I joined Chang'an two years ago.

I joined to set up the European business.

I was the first commercial employee in Europe.

Well, perhaps get on to Chang'an already has about 500 other employees in Europe designing cars, engineering cars, etc.

But I joined to set up the business.

So beginning of last year, I was in Munich, hiring a team there, building up offices,

all the things you need to actually run a business, getting things incorporated

and getting your VAT numbers set up and logistics suppliers and parts warehouses

and everything else that you need to go and do bank relationships,

while setting up some distributors in places like Norway and Denmark and Greece and Portugal.

And then since the start of this year, I've been in the UK.

So as you said, I'm the UK MD, building up our national sales company in the UK.

We are very fortunate that we've got an R&D centre in the UK already,

which has been there about 15 years in Birmingham.

So we own a large part of a business park in Birmingham with lots of R&D facilities

and we've set up our UK head office there.

Nick, tell those people listening and watching a little bit about the brand then, Chang'an.

Where does it sit in the global market when it comes to cars?

I mean, how big is it as a brand?

So this year Chang'an is a group, we'll sell about 3 million vehicles.

You mentioned VW in your introduction and it's a similar structure

where you've got multiple brands under a group heading.

We're trying to simplify that when we come to Europe and just not have the proliferation of labels

that some Chinese companies like to have.

But Chang'an as a group, we'll sell about 3 million vehicles this year.

We have joint ventures with Ford and Mazda, so in China we make cars for them.

But that's a very small part of what we do.

About 85% of everything we do is our own vehicles.

We've sold out the three primary badges, which is Chang'an itself.

In Chang'an that's called Chang'an Nivo, but we'll just call it Chang'an.

The nose detail, which is middle of the range and kind of volume brands saying they're premium.

That's not what we are, but it's very, very attractive, very well equipped,

very high quality vehicles at very attractive price points.

Then you've got VW, which is the kind of luxury sports brand up at the top.

If anyone's seen that triangle that's going around on LinkedIn of where all the Chinese brands sit,

it's right up towards the top of that triangle with some really beautiful cars with stunning interiors

and the latest technology, and they go like the clappers as well.

We're about third or fourth in the ranking of Chinese car companies,

but actually we're a very, very old company as well.

Chang'an's been around for 160-odd years as a trading company.

Making light trucks since the 1950s and passenger cars since the 1980s.

So a very well established company.

We've got factories all over China, but we sell cars all around the world.

Quite big in parts of Southeast Asia and the Middle East and South America

through distributor relationships.

Now we've got national sales companies in Thailand, where we've got a factory in Mexico.

We've got a national sales company and now leaving the startup in Europe

where ultimately we'll continue to expand our design and R&D,

but we'll also have manufacturing in the future and all of those sorts of things.

So what's the plan for here in the UK then?

What are you going to come in with in terms of models?

And what's the distribution network going to look like?

Are you going to work with dealers?

Absolutely, yes.

So first of all we're going to really simplify the brand line-up

and everything would just be called Chang'an.

We will take a selection of models from kind of the mid-range of where Chang'an sits,

so that we'll take some D-pal models and we'll take some Chang'an Nevo models,

but group them together.

So one show room called Chang'an, one website, one brand,

every model will be called Chang'an, just keep it really, really simple.

For the customers and for the dealers, that's number one.

We start with the Chang'an D-pal SO7, which is the same size as a VW ID4

or a Tesla Model Y, that sort of thing.

But to my mind, it stands out from the competition because it looks different.

It doesn't look like every other car on the road.

They're designed in Italy.

We've got a design centre with 300 designers in Italy that's been operational for 20 years

and they've been part of the success of Chang'an in China.

But they're now meaning we've got some really stylish,

some really attractive and very high quality cars to sell as well.

So we start with the SO7, then the SO5 comes by the end of this year,

which is kind of Ford, Cougar, Nissan, cash guys type size.

And both of those will have both EV and hybrid power trends.

And then we'll build out the range over the next couple of years

with smaller and cheaper cars as well.

Last about distribution, dealer-wise, we are looking for

to have about 60 showrooms open by the end of this year around the UK.

We've got 40 signed up already, 20 open as of now,

with another 20 planned to open before the end of this year

and lots more work to do to get the other 20 on board.

I think, again, to differentiate ourselves,

I've been building up for the last two years a really experienced team.

As I said, I started in Europe, but now in the UK

and have been fortunate to bring on board a really great UK team.

We've got about 30 local hired people now

and similar to myself all with lots of really good industry experience.

And we're trying to anticipate and avoid some of the mistakes

that we've perhaps spent part of our career trying to fix.

If you've worked in dealer network over the last 25 years,

you've probably been going through an ideal network plan

or something similar to that where you're trying to consolidate

to a smaller number of partners

and close some of the smaller outlets

or the less profitable outlets

and not have two or three different dealer owners

fighting against each other in the same territory.

So we're setting up market areas from the start

and across those 60 outlets we'll have 25 partners maximum.

And as we grow in the future,

we only want to grow to about 100 sites nationally

but still with those 25 partners.

And because we've taken that approach

and because we've got a very solid company behind us

and a fantastic product line-up,

we've been able to really attract

some very high quality partners to work with us.

So we've already got sites open with lookers,

with Stonaker, with Parks,

with DM Keith, with Sandy Cliff,

very reputable partners.

Many more I should mention,

but I haven't got time to mention them also, apologies.

We've also signed with a number of other

very, very reputable, very large groups.

And in fact, there are plenty of others

who we're not quite signed with.

I can't quite announce,

but I was in the offices of a very large group yesterday

going through a detailed plan

for a large market area with them.

And so those other 20 sites

that we need to sign are well underway.

So it's really paying dividends

having this solid approach, I think.

So there's clearly an appetite out there

in the dealer network for another Chinese brand.

I just sort of imagine, I mean, just from the report

that we've done that they keep having these knocks

on the door from another Chinese brand

wanting some showroom space,

you've been well received.

I mean, is that because of the offer that you've got?

Is it because of the cars?

Why do you think it is?

I think it's a combination of everything.

Firstly, as I said,

I've recruited a really experienced

and really well connected team.

So when we want to talk to the big groups,

we've got their number, they answer.

And then we can go in with a really solid lineup

of product coming through

under a really big company behind it to back that up.

So they know we're...

I always think there's kind of three questions

that a dealer would be asking in that first meeting

is who are you

and are you still going to be here

in six months or six years time?

Two, have you got a product lineup

that I can build a business case around?

And are your standards

and your investment requirements reasonable enough

that I can build a business case around that?

And three,

do you have a clue how to run a business in the UK?

Because there's plenty of Chinese car companies

that are just going to ship cars on a boat

or not even Chinese,

Vietnamese or American or whoever

just going to send some cars here,

but they haven't done the backup.

They haven't set up the business.

And I've spent the last two years

with, as I said, a really great team

and not just the locals,

but a brilliant Chinese team as well,

setting up a proper business.

So we've been...

Before we launch,

we've got a banking partner in place.

Not everybody did that,

but wholesale and retail finances in place,

as well as fleet and leasing.

Before we launch,

we've been working with Fathom for more than a year

to make sure that the industry is ready for us,

that they know how to ensure our cars,

that they know how to repair our cars.

We've got a parts warehouse

operated by Coon and Nagel

at East Midlands Airport,

already there, already stocked before we launch.

All these things that have tripped up everybody else,

we've been in CAP Gold Book since July.

All these things that have tripped up everybody else,

we've anticipated

and we've done all these things before we launched.

And actually, I think the number one,

because we've got this R&D centre in the UK,

which has been operating completely under the radar,

I didn't know anything about it,

but it's been there for 15 years.

There's 100 engineers during powertrain engineering.

It's a global centre of powertrain excellence

for Chang'an.

But those engineers got hold of a car last year

and went, ah, what brilliant car.

What terrible suspension.

What terrible software systems.

Just like every other Chinese car.

But instead of going, oh, well, let's try and sell it.

They went, right, let's fix that.

And in three months,

they completely redesigned the suspension,

recalibrated it,

did a proper calibration exercise on UK roads

and rebuilt a suspension.

At the same time,

they changed all of the software systems,

all of the ADEF systems,

properly calibrated them to UK roads.

And I was driving with a journalist the other day

and he said, oh, you've disabled all the ADEF systems.

Have you?

I said, no.

I said, well, why aren't they beeping and buzzing at me?

Because they're properly done.

There's good technology and there's bad technology.

ADEF systems are there to protect you.

They're not there to drive you insane.

And if you do a really good job on actually calibrating them,

they work really well.

And that's what we've been able to do

because we've got a brilliant team of engineers in the UK.

So when you tell that whole story to dealers and to media

and those things, people respect that.

They recognise that you must be serious

about wanting to be a serious player in the market.

Nick, you've worked for Ford.

You've worked for Nissan.

What's it like working for a Chinese company compared to them?

I think it's not particularly...

I've worked all around the world for those companies

and each country is different.

Each country has its own culture.

It's more about the challenge of working in a start-up, I think.

Chang has a 160-year-old company,

but in the UK, we're a start-up.

And yeah, that requires...

It's probably the most challenging thing I've ever done

and I ever hope to do.

It's a lot of hours. It's a lot of effort.

Well, it's actually challenging yourself.

I knew how to run parts of or run a car company in a country

or run parts of a car company.

I had no idea how to set one up.

Really simple things like, well, how do you register a vehicle?

Well, the people over there have Mivris

and they have Vista and they have this and they have that.

Well, how do you get those set up?

I don't know.

And literally for a period of time, I was on my own

and I had to go and figure all that stuff out.

And I always say, if I'm interviewing somebody,

it's like, there's no such thing as that's not my job

and there's no such thing as I don't know how to do it.

I had to figure out how to change the soap in the toilets

because we didn't have a cleaner.

And through to, I had to go and negotiate with the chairman

of a very large car company

about sharing their factories in Europe,

which is also something I'd never done before

and every other thing in between.

And you just...

I'm trying to recruit people

who have been able to recruit some great people

who are not only very experienced

but are ready for that kind of start-up mentality

where you've just got to go and get stuff done.

You've got to go and figure stuff out.

And there's a lot of people I've said,

I'm sorry, I don't think this is going to work for you

because you've spent 20 years in ANOEM

and any of us who've worked in a big OEM

know that they're like super tankers

and they're especially in the UK.

They're rolling forward and you slot into your place

and you do that.

And you can try and change a few things

and improve a few things

but fundamentally, things are provided for you

and you have to make them work.

This is totally the opposite.

And as you said at the beginning,

my career has been fairly varied.

I've often been within large companies

but at the more, I won't quite say cutting edge

but the newer parts of that setting up

distributors in Eastern Europe

or setting up an EV business or those things.

And I need people like that

who can just be willing to accept those challenges

and jump on with those sorts of things.

Have you been impressed by the pace of a Chinese company?

I talked to dealers representing some Chinese brands

that are already here

and they just report back to me that their ambition

and what they expect of their franchisees

and their employees is far higher

than they've ever experienced before.

Do you see the same sort of thing?

Is it tough?

Is it a hard company to work for?

I think it's a great opportunity.

And as I said, you don't want,

it's not the right environment for somebody

who's very comfortable and safe working for a big OEM

and just doing their job.

Nothing wrong with that at all.

It is the speed at which people develop,

the speed at which the business develops

and I joined it because I wanted to challenge myself

to be a part of that revolution that I could see coming.

And I think that's why dealers are joining as well.

They can see that the writing is on the wall

for quite a lot of legacy brands

and they want to be a part of that.

And I think for as soon as an individual

is working within a company,

yes, the speed is incredible.

As I said, I first drove the car

I thought was suspension rubbish

and the software is rubbish.

What have I done?

But within three months that was all fixed.

I've never seen anything like that before.

And that's huge.

And equally, I think, yeah, it's hard work.

There's long hours.

There's no hiding that.

But as I said,

primarily that's actually about the start-up side of things.

What's hugely impressive is how much my Chinese colleagues

apply themselves,

how interested they are to learn about the market.

They recognise they don't know much about these markets,

but they're damn sure they're going to go and learn about them.

And when I started,

most of my Chinese colleagues didn't know what a residual value was.

They didn't know what a monthly payment was.

They didn't understand these concepts

because they don't have them in China.

The Chinese approach to selling cars and brand

and all sorts of things is very different.

We talk about a concept on a Friday

and say, well, we need to start doing residual value assessments.

And this is how monthly payment works.

And these are all the important things.

And they'd all listen and go, OK, got it.

And they'd ask some questions.

On the Monday morning, they'd be, right,

so tell me about your remarketing strategy

and tell me about the finer points of, you know,

what sort of a mixture we could be doing in these sales channels

and how are you going to guarantee

that we're getting above book on this and that...

Hang on a minute.

On Friday, you didn't know anything about this,

but you spent your weekend applying yourself

and, you know, there's all sorts of AI tools.

Now, you can learn in depth about anything

if you want to devote the time to it.

And they do, and it's incredible.

And I don't mean the CEO.

I mean, like, junior people and everybody in between.

And it's, yeah, as I say,

I challenge myself to be part of this.

And I'm relishing that challenge

because my brain is getting rewired

on what's possible, you know,

volumes and, you know, how quickly

can you put a brand into the market

and I applaud some of the other brands

that have grown an astonishing rate

that I would never have ever said was possible before.

No, they really have.

The industry is getting rewired.

And if you want to be part of it,

you've got to rewire your own brain.

Yeah, they really have, haven't they?

I mean, I was just...

I had a run yesterday morning

and I saw three J-Cous

and I don't run very far.

So, you know, I was kind of...

I'm amazed at how the...

Was it past the J-Cous showroom by any chance?

No, it wasn't.

That's a bit too far from my half.

But no, I am amazed at how quickly

these Chinese brands have taken a foothold in the UK.

And that does...

It brings me onto my question

about that consumer proposition.

Are you concerned at all

about how many Chinese brands are here?

You know, I mean, if you look at the market,

we are being flooded with Chinese brands at the moment.

How do you make Shang-An stand out?

I'd be a lot more concerned

if I was still at a legacy brand, if I'm honest.

Yeah, and I think that's the point

that you dealers are taking is...

Yeah, the Chinese brands are coming,

but it's not a question of which one

or two Chinese brands will succeed.

It's which other brands are going to die

because they don't have the product coming through.

They can't compete.

So, when it comes to your ambitions

for Shang-An in the UK,

I mean, what are they?

If we're having this conversation in three years' time,

where would you like to be?

We see ourselves as being right up there.

You know, on the world stage, on the Chinese stage,

we're right up there with BYD, with Cherry, with Geely,

and that's exactly where we expect to be

at a group level as well.

That will require us to get into the top 10 in the UK

in the fullness of time.

I'm not going to put a date on that.

It's about, you know, our approach is different, I believe,

because our approach is, as I said,

about building a proper brand,

building a proper business,

doing things with quality for the long-term

rather than just rushing in

and trying to get cars registered.

It's not about that.

And that's where I believe we'll differentiate ourselves

because we've got, you know, beautifully designed products

with great tech, but properly adapted to the UK as well.

And so the customer experience

and the cars are full of tech,

but it's properly designed around the customer.

It's properly intuitive and usable tech

rather than just interfering

and destroying your driving experience.

So that's really important.

And yeah, you've got to differentiate yourself.

You've got to demonstrate

why customers should want to buy your product.

And that's what we're trying to do.

We've got plenty of brand marketing going on as well,

which is, again, things where other companies

have perhaps tripped themselves up.

They've launched cars, but they haven't done enough.

You talked about having been to every launch event lately,

and that's a very Chinese way of doing things.

But again, we've been educating and working together

to put in place more traditional marketing campaigns

to actually establish a brand.

Again, we've got to rewire our brains

because marketing has changed fundamentally

in the last five to 10 years as well,

digital marketing and social media.

The routes to market are very, very different.

But we're fully investing in all of those things

to really establish that ground.

And you don't just get into the top 10 in the UK.

You've got to deserve your place.

You've got to fight for it.

You've got to build a really great business.

Give me an idea of the models

that you're launching with in the UK

and where they sit.

I mean, give me an idea for those people listening

who might not know anything about them.

Give them an idea of how to picture them.

What are their rivals to?

So the SO7, the Chang'an Depot SO7,

is 4.75 meters.

So it's Tesla Model Y.

VW ID 4, Ionic 5.

Sort of territory.

It's an EV to start with,

but it will be a plug-in hybrid as well

in the same body style next year.

There's only one price point.

There's only one spec.

Everything on the car,

all for just under £40,000,

just under that luxury EV tax,

£39,990.

It's a crafting car.

It looks beautiful.

I've been driving it for nearly a year now

and I keep thinking I'm going to get robbed

when I park up in the centre of the city,

but it's all the kids

when I say, what's that mate?

What are you driving?

It looks really good.

It really stands out.

I could have a lot of hotel car parks.

I could have sold a lot of cars in the last year.

Then we've got the SO5,

which is slightly smaller.

Again, comes as an EV to start with,

priced in the low to mid-30s.

And then we'll be in the plug-in hybrid market

as well with that by the middle of next year.

Then after that we've got,

I won't call it SO3,

but product number three,

which is smaller again,

so down into the Duke and Puma territory,

again as an EV and as a hybrid.

Those are the first three cars that we've announced.

But Chang'Anna, the group,

we have something like 40 different cars

on sale in China

and about 60 different cars in the pipeline.

We won't bring all of those to Europe, of course.

That's not the right thing.

It will bring the 68 cars,

which are really going to excite

the customers and be appropriate to the market

and build that product portfolio for the dealers.

Then we've got Avatar as well,

so Avatar will launch over here by the end of next year.

And similar size to the SO7,

slightly bigger.

So you're into a BMW X3,

Mercedes-Benz GLC territory,

but really in terms of sports,

technology styling,

it's really a Porsche Titan and Audi GT

and sort of vehicles,

but obviously at half the price.

I'm interested in how important the UK is

to these Chinese manufacturers.

It feels like we are the market.

They all want to conquer.

Do you think that's true?

I think there is a general globalization trend

amongst the Chinese car companies.

That's clear.

In lots of markets, like I said earlier in Asia,

in the Middle East, in South America,

but Europe is the next destination

and it's definitely where we want to

really create our second home.

We will have manufacturing here.

We will continue to build our R&D and design presence.

I think the rest of Europe is challenging.

It takes a long time to establish a new brand

in Germany or in France.

In markets like the Netherlands, Denmark,

Norway, they're much more open,

but obviously they're much smaller in terms of potential.

The UK is that sweet spot where we don't have

our own brands anymore that we own,

domestic brands.

Yes, we've got some manufacturing,

but UK consumers are more open.

It's also more EV and hybrid-led market than others.

If you look at Italy, for example,

that's a tough market to crack

because there's still a lot of very small cheap cars

that have petrol and MPT.

The UK is a great destination

for a company like ourselves

with the technology that we've got

across EV and hybrid

with the high-quality vehicles that we've got.

They tend to be larger vehicles

than in the southern markets as well.

They like smaller cars, cheaper cars.

The UK is that sweet spot in the market right now.

The thing that's fascinated me about

the launch of these Chinese brands in the UK

is just being the market

and consumer acceptance of them so quickly.

If you remind the clock back to...

In Japanese cars launched in the UK

or Korean cars,

they came with a bit of stigmatism

that people didn't want to buy them.

They didn't want to be seen to be driving them.

But Chinese cars seem to be completely different.

They seem to have had acceptance almost immediately.

Why do you think that is?

I think you're right.

Clearly, we've done all those studies as well

that say this long for the Japanese

and this long for the Koreans, etc.

Yeah.

With all respect to those brands,

and I used to work for one of them,

the cars that they came with first of all

were very basic, very cheap cars.

They've now developed into

very serious,

very high-quality, very well-specced cars.

But that took them time

and that's been the journey that they've been on.

The Chinese

and particularly Chang'an,

I need to say,

with already better cars

than the Europeans are making.

I am surprised, as I said earlier,

how quickly

companies have been able to grow.

But I think, as I said,

the UK consumers

are open to new brands.

I think EV particularly

has really disrupted the loyalty circle.

I grew up

getting schooled in how to sell forward options

and PCPs and these things

and how to keep customers loyal

and how those customers are going back to,

not to pick on forward, but going back to

the showrooms of legacy brands saying,

hang on a minute, you haven't got my next car for me.

Or they're saying,

actually, yeah,

I need to think about getting into an EV

because I'm on salary sacrifice

or because I just want to

or whatever reason.

And that's opening up the world to people

and they're looking around and they're seeing

that there are lots of new companies

that can offer astonishing cars

that have a lot of value.

Do you think it comes down to

a lot of support with

warranties and that aftercare?

I mean, I see a lot of Chinese brands

are offering very long warranties.

I mean, I think a moded as

seven years of RAC cover included

with a new sale.

Is it about giving customers

that confidence in the car?

You certainly got to give people the peace of mind.

You've got to start with the dealers

so that they can transfer that peace of mind.

I passionately believe in customer service

and Chang'an very, very strongly believes

in customer service, but that starts

by giving really good service to your dealers

and that's what we've been setting up.

And you're right, yeah, we're coming

with a seven-year vehicle warranty,

100,000 miles and an eight-year battery warranty.

So that gives you the peace of mind.

But the dealers have to be able

to give those talking points as well.

They have to be able to say, yeah, the parts warehouse

is just there.

If you have a crash, we're ready

we know how to do the diagnostics.

Data.

People are really concerned about their data.

We say very clearly

any vehicle data, any customer data

is all stored on

Amazon Web Services in Germany.

And until earlier this week,

that was a really positive thing to say that it was

Amazon, but anyway, at least it's

in Germany, nothing's going to China.

And that's for people as well.

So you've got to give them that reassurance.

And fundamentally, I think they recognize

that they're just better cars.

The other thing that's obviously given

Chinese companies a leg up is

the fact that we are tariff-free.

I mean, this is a market, there's a bit

it's very much open to China,

unlike Europe, which

has been has been put in tariffs

on Chinese vehicles.

Is it something that concerns you at all?

I mean, I just looking at the way

just personally looking at the way the market's going

you see the Chinese running rampant

in the UK with their

car manufacturers.

I just wonder whether it will be allowed to continue

as it is.

As somebody that works

has always worked for global multinationals

tariffs and any barrier to free trade

definitely concern me.

But equally, I've always worked for global multinationals.

One that was owned by Americans

largely on the stock market

and the Ford family, one that was owned by

Japanese largely on the stock market

and now I work for one that's owned by Chinese

and the stock market. Each of those companies

has been very successful in Europe

because they've had a very strong European base

because they've built European factories

they've employed lots of local people

they've created lots of value

in the local markets and that's exactly what

Chang'an is going to do as well.

And that the only way we will get to the level of success

that we want is if we continue

we're committed to more than 2 billion euros

of investment in Europe in the next four years

which is manufacturing

which is product plans

for local employment and that's what

interests me as a UK

taxpayer, UK citizen. I want to work

for a company that's going to invest in the UK.

And Nick, are you still looking for dealer

partners?

As I said, we're having lots of success

we're having really, really good

discussions with

some big and we're not restricting

ourselves to the big groups. We've got some great local heroes as well.

But there's always

some hard to fill gaps

bits of London are always challenging

Guildford and

Reading, Bristol

and a couple

of those bits of the Midlands belt

or not really the Midlands but Peterborough

and Milton Keynes in those areas

are still hard to fix. We've got some ideas

and we're working with some people but always

happy to hear from people. You can find me on

and always happy to hear from people.

Perfect. I was going to ask you where people can find you

but you've done that plug for yourself so perfect.

Nick, thank you so much for joining us

and giving us that insight into the brand.

I'm fascinated to see how

you make it a success and look forward

to driving the cars. Thank you.

Yeah, well, we aim to be not just

another of those boring Chinese brands.

I'll stand out a bit. Well, thanks

for joining us. John, we should probably

though do some stories.

Now a quick word from one of our

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This is a paid partnership

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John, guess what?

Oh, God, you bought more ducks, haven't you?

No ducks, John.

Wrong there. I've actually got a new habit.

I've signed up for Dealerway

alongside more than two and a half

thousand other rated

and vetted car dealers to sell my

trade part exchanges.

The site is designed for dealers to sell their

part exchanges for more money quickly

and easily. There's no sellers

fees and buying a car costs

just £99. One of the cheapest

around. And when I haven't got

the time to list the car myself, I can

even watch out them the details and they do it

all for me.

That sounds awfully familiar.

So are you selling all your stock there now?

Not exactly, John. But if I

do have a sudden influx of

tantos, I know where to send them.

Dealers can find out more

at dealerway.co.uk

Now, back to the podcast.

Yes, so James and I are going to run through our

favourite stories of the week. And at the end

Nick gets to decide which one of us chose

the best ones and who is the winner.

Rebecca won last week

in your absence, James. So do you

go to go first?

Yeah, I do.

I lost, so I don't get to go

is the point.

Well, I am going to go

with news from

Robert Forrester

warning against a potential

motability tax as he hits

out at the gimmick approach he said

this week when he gave

his speech to the London Press Awards

that I spotted on LinkedIn that they had

Geely launches in UK, Robert Forrester hits out at 'Motability tax', and how quickly should a dealer answer the phone? - with Nic Thomas, episode 228

About this episode

rocker cover

Geely

Volvo

Lotus

Polestar

electric vehicles

Nissan Leaf

Chang'an

Mazda

Chang'an D-pal SO7

Volkswagen Id4

Tesla Model

Ford Cougar

EV and hybrid powertrains

residual value

Bmw X3

Mercedes-Benz Mercedesbenz Glc

Porsche Taycan

Audi GT

battery warranty

Dealerway

part exchanges

Invercar

Seat

Škoda

mild hybrid engines

SEAT Leon

Seat Ateca

Volkswagen Group

Hyundai Ioniq 5

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