Edgar Estrada
Brand Director
SEAT México
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View from the Top

Struggles Give Rise to Progress for European Brand

Tue, 09/01/2015 - 12:22

Q: How has the market share of SEAT evolved in the Mexican market in recent years?

A: Shortly after the original launch of the brand in Mexico, sales peaked in 2002, with 25,000 cars sold. However, in 2011, the brand was just emerging from a series of very difficult years when sales dropped to 13,000 units per year. During that year, we took the company in a different direction, which enabled us to grow sales volume to 18,000 cars, followed by 21,100 in 2012, 18,000 of which were the SEAT Ibiza. The solution was to create an aggressive joint plan with our dealer network, which helped to determine the growth potential in every sales location in the country. We have also been actively working on the evolution of the brand, as we are facing new challenges, new competitors, and are entering new segments. The most important part of our strategy is extending our product range, with a prime example being the upcoming introduction of a new SUV in Mexico.

Q: How does SEAT intend to compete on price points with rival brands?

A: For SEAT, one of the most important factors in the Mexican market is the value the customer gets when they buy a vehicle. We cannot be an expensive brand, but we are a brand that gives you more value for money. SEAT is a high-quality brand, it has German and Spanish genes that combine to provide trustworthy technology and security, yet its cars remain affordable.

The SEAT Leon is our flagship model and our sportiest vehicle. In the past, the Leon was seen more as a racing car targeted toward young people. The strategy of the car has changed to be more open. It is now seen as a more mature car that attracts a wider scope of customers, while still remaining popular among young people. Furthermore, it has improved its efficiency, reliability, and convenience. As well as having an invigorating sense of performance, it also has a complete security system, including airbags and ABS brakes, a navigation system, LED lights, alloy wheels, sunroof, and subwoofers, all for a very reasonable price. Among the Volkswagen Group brands, SEAT has experienced the fastest worldwide growth, and this is largely due to how well-received the Leon has been since its launch.

Q: What actions is SEAT taking to consolidate the brand in Mexico, particularly in the secondhand segment?

A: We have an increasing vehicle park of 255,000 cars in Mexico after 13 years in the market and our presence is still growing. Our market strategy for the used vehicle segment involves planning for the future, but it must be implemented one step at a time. We are trying to be more professional while improving our aftersales service, which also requires an increase in used car sales through our dealer network. One of our strategies to achieve this is through Volkswagen’s Das WeltAuto used car program. We aim to offer the best value to the customer in this sector, including an upgraded aftersales service based on better processes. SEAT is consolidating all of its processes at the dealer level, as well as training its staff to deliver the best experience to the customer.

Q: Are there any plans to establish a SEAT manufacturing plant in Mexico?

A: As of today, there are no plans to do this. However, depending on the development of the brand in the country and in the region, there is always a possibility for the future. Mexico is the fifth biggest market for SEAT worldwide, making it truly important to our headquarters. Even if we do not have a plant, our Mexican operations are responsible for adapting the product, its equipment, and its settings to the Mexican roads, as well as matching its pricing to the local market.

The first priority for the brand worldwide is to fulfill the production capacity of the plant in Martorell, Spain, and with the new line of vehicles SEAT is releasing, there is a promising possibility we may reach the desired production numbers. Today, SEAT in Mexico is fulfilling 98% of its customers’ needs for spare parts. The high level of coordination with Martorell and our large distribution center in Mexico allows us to have excellent logistics, and we have no problems when it comes to backorders. Our Chairman Jürgen Stackmann has a deep understanding about the strategies needed in the automotive business. In his visits to Mexico, he is always keen to understand how the situation is evolving here in the local market, and he talks directly with the dealers to help elaborate our medium-term strategy.