Ford, Vauxhall, Volkswagen: How UK's best-selling cars rose to success and plan to stay there
19 min read
15 May 2015
The best-selling car brands in the UK in the first quarter of 2015 were Ford, Vauxhall and Volkswagen. But how did each become successful and how have the different brands managed to maintain that position?
Despite Ford’s ethical reputation, it has a rap sheet for misconduct. Take, for example, the Ford Pinto, which had a fundamental flaw in its design. Namely, the gas tank was nine inches behind the rear axle instead of above it. The bolts were too close to the gas tank and the fuel filler pipe had a tendency to disconnect from the tank and cause petrol to spill out. The result was that a small collision or accident could cause the car to explode. Of course, the fact that Ford had known about this flaw since it first started selling the Pinto but did not change the design due to the high costs involved, was only revealed during a lawyer’s investigation.
Then there was the Firestone tire scandal. In 1998 an investigator found that 84 per cent of tread-related complaints and accidents were related to Firestone tires on Ford vehicles. More disturbing was the possibility that tire tread separation from defective tires could have caused hundreds of deaths. This resulted in a substantial recall.
Yet Ford keeps restoring its reputation, as well as its popularity. The company’s ability to fail and get back up as reigning champion is something that dates back all the way to its creation.
Before starting the Ford Motor Company, Henry Ford was a part of two failed automobile enterprises. One was the Detroit Automobile Company, which folded after Ford failed to ship a working automobile, while the Henry Ford Company became known as the Cadillac Automobile Company after failed partnership dealings.
Ironically, it was the shipping part of the business that almost caused Ford Motor Company to fail as well. Enter James Couzens, not known well enough for his endeavours, who resolved to get Ford’s product to market.
Ford was known for being a perfectionist who cared about minor details. Their superior craftsmanship often led to them slaying the competition, particularly in terms of racing. However, investors would wait months for a final product to be brought to market, only for Ford not to submit a design as he was continuing improvements.
“Stop shipping and we go bankrupt,” said Couzens.
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Both philosophies have been upheld since then. More insight into the way things were run at the company was delivered in a 1945 interview with the then president Henry Ford II, who everyone referred to as “Hank the Deuce”.
By that time Ford had become an iconic brand, but managed to keep itself afloat at the end of World War II, when financial collapse was a realistic possibility. Key to this success was knowing the audience, he stressed.
“We have been doing a substantial amount of research and experimentation, both regarding the kinds of cars people want and regarding possible radical changes in car design,” Ford said. “At one time we did a lot of work on a radically different light car using new materials and weighing about a third less than present models. At least for the present, that idea is on the shelf, for the very good reason that our studies indicated that a light car would not give people what they really want–they want a car that will hug the road at high speeds; they want an extra-heavy frame and a car heavy enough to carry a lot of extra equipment.”
In fact, Ford found out that people preferred big cars at low prices.
An area prioritised by the company was “to treat the men [they] worked with as [they] would like to be treated [themselves]”.
Another answer to the question of its success rests in knowing to pass the baton on to someone outside of the family. When Alan Mulally took over as CEO, he claimed that “[they] were going out of business”.
He mortgaged several assets, including its famous blue oval, and sold off brands such as Jaguar and Volvo, in order to secure a $23.5bn loan.
“When Mulally joined Ford, the company was at war with itself,” said auto journalist Bryce Hoffman. “The corporate culture was notoriously dysfunctional, even by Detroit standards. He forced executives who had been at each other’s throats to work together.”
Mulally revamped Ford’s manufacturing lines to operate with 70 per cent of the same parts, which has allowed the company to tweak production based on consumer demand and oil price trends. He also invested in high tech, suggesting that “technology and innovation are the foundation” of the Ford plan.
Essentially, he wasn’t afraid of changing culture and tradition, not to mention that he took several risks that all panned out.
Read on to find out about Vauxhall.
SMMT statistics revealed that Vauxhall was second when it came to best-selling cars in the UK. This is something that Vauxhall is all too aware of.
Tim Tozer, chairman and managing director of Vauxhall Motors, had a target set for him by his predecessor. This was to overtake Ford as the UK’s number one best seller. Ford holds the top two slots for car sales in Britain with the Fiesta and Focus. Between them, the two models have racked up sales of 115,000 cars. Vauxhall’s Corsa and Astra have a combined sales of 75,000.
“You can’t underestimate Ford,” Tozer said. “It is not a great idea to try and outsell them at any cost – which we could do if we chased the daily rental market. But we can give them a run for their money.”
Indeed, while its export sales have slumped, in the UK, the cars are selling like never before. Of course, it may not be the most famous of brands, but its long history within Britain gives it a great selling point: British heritage.
Despite the fact that it’s not one of the most famous brands on the automotive market out there today, it enjoys a long history. It was founded in 1857 by Alex Wilson in order to build pumps and marine engines. After being bought by General Motors in 1925, the company started making Churchill tanks, andits foray into vehicles began.
Much like Ford, the company had a “reputation stumble”. After the war their car-making process saw a mass-market orientation, but this led to Vauxhall cutting a few quality corners. Their cars were referred to as “rust-ridden”.
One of the company’s biggest moves was a partnership with Opel in the 70s, something which churned out some of Vauxhall’s most memorable cars. But as Opel dealerships closed down in the UK soon after, Vauxhall reigned supreme.
Since then, Vauxhall has managed to reduce the gap between them and Ford with the launch of the 2004 Astra.
In 2014, Vauxhall boss Karl-Thomas Neumann suggested that Vauxhall was a British brand with a British heritage and that they wanted to “keep it that way”.
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“The brand is much better off because it is the second strongest brand in Britain, but it needs to be taken on a journey, polished up, renewed and modernised: brand is a huge focus,” he said.
Tozer claimed that the biggest task has been defining Vauxhall as a brand and building a business that is sustainable. He has even started talking to agencies about the best way to market the “Griffin” marque on the car.
According to him, Vauxhall is not a cheap brand or a premium one, it is “generalist” in that its products appeal across the spectrum.
“It is value, but that is a term that has been hijacked in recent years and we need to get that word back because what Vauxhall can offer is great value and great engineering,” Tozer explained. “Value doesn’t necessarily mean cheap and post-economic crisis you see a shift in the way people look at purchases. For example, there are many people in the UK CD socio economic sector that now shop in places like Aldi or Lidl where they wouldn’t before – the stores were considered cheap rather than good value.”
Neumann claimed that another way he hoped Vauxhall would prove successful was in the connected market. He suggested that the reach of connectivity is still overlooked in the media: “We have said we will not wait for the European Commission to come up with legislation about the ‘e-car’, we will put it into the majority of our cars as standard and it will be available for every car.”
Tozer pointed to Vauxhall’s small cars, the Adam, and the upcoming Corsa likely to be called Viva.
These cars play in the market in different ways. He said: “There is a lot of passion for the brand in the UK, both within and outside the business, but people don’t necessarily understand it and I don’t think GM has for a while. The brand has not been invested in, nurtured or developed and has jogged along on the ups and downs of the products.”
It is his belief that the individual nameplates are understood better than the Vauxhall brand itself. If you ask someone on the street “you will get a myriad of different answers”, he said before noting that getting a clear brand identity is a work in progress at the moment.
Read on to find out about Volkswagen.
The relationship between Ford and the Nazi regime was revealed when Hitler told a Detroit News reporter he was an avid reader of the “antisemitic tracts” penned by Henry Ford. “I regard Henry Ford as my inspiration,” Hitler said, explaining why he kept a life-size portrait of the automaker next to his desk.
According to researchers, Ford “inspired Hitler’s treatment of Jews,” and was the role model for the then-reasons behind Hitler’s foray into vehicle manufacturing: to reduce unemployment, and by providing Germany with modern infrastructure such as the worlds first super-highway, the Autobahn.
In 1937, Germany formed a state-owned car company called Gesellschaft zur Vorbereitung des Deutschen Volkswagens.
To stimulate the German industry, Hitler deemed it necessary to develop a car the average citizen could afford. In 1936, Hitler spoke at an exhibition, suggesting that if he hoped to increase the number of cars in Germany to 3-4m, “the price and the maintenance costs of these cars must be compatible with the income” of those 3-4m potential buyers.
He said: “I have no doubt that the genius of the man [Ferdinand Porsche] who has been entrusted with the design and construction of this vehicle, together with those who will later produce it, coupled with the sound economic good sense of all who will be involved, will succeed in keeping the purchase price, as well as the operating and maintenance costs of this vehicle in line with the income of the broad mass of our people, as in America, where we have seen a brilliant example of how this problem can be solved.”
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He may have been referring to Ford there.
According to David Marsh, who penned “From The Germans: The Pivotal Nation“, Hitler’s “furthest reaching economic achievement” was his plan for the “People’s Car”.
Fast forward to 2013 and Volkswagen has become the third best-selling car in the UK.
Joann Muller of Forbes, who sat in at one of the company’s meetings, reported that Volkswagen boss Martin Winterkorn made his team watch the video of Germany’s football match against Sweden at the World Cup qualifier. Early in the second half, Germany was leading 4-0, yet the final score ended up being a tie.
“It’s half-time,” Winterkorn allegedly said. “We’ve had three strong years. You might feel good, but we have to stay focused.”
His goal, it seems, is to top GM – the company in charge of Vauxhall, who in turn is gunning for the top spot.
By 2018 Volkswagen will be “the world’s most profitable, fascinating and sustainable automobile manufacturer,” Winterkorn said.
He also planned to have the most satisfied customers and employees in the industry: “Only an automaker who can achieve all these goals, can really call itself number one with justification.”
Muller discovered that in 2012, Volkswagen had earned a record 13.2 per cent on $250bn. Spanning across several years, Winterkorn intended to deploy this cash toward the biggest spending binge in Volkswagen’s history.
Along with its Chinese joint ventures, the company will be investing in ten plants, as well as several different products and technologies such as plug-in diesel hybrids and advanced infotainment systems.
Remember the football match and its results? Winterkorn told his team: “We have completed an extremely successful first half with a strong team and the right strategy. However, one thing is clear: Conditions on the pitch are deteriorating. Pressure is growing. Volkswagen must continue to attack and make good use of its opportunities. Then we will still be ahead when the final whistle blows.”
Tim Mahoney, product and marketing executive, credits the company’s success to its well-timed product launches, quality and memorable TV commercials.
“It’s sort of a perfect storm, in a good way, of the things coming together for the brand,” Mahoney said.
The secret to Volkswagen’s success is the strength of the brand. When Ferdinand Piëch took over in 1993 he enlarged and modernised the fleet, and took some crucial steps in emerging markets. Robust sales in China always seems to keep the company going. Its performance there was particularly strong in 2013, when the group sold 3.27m vehicles and narrowly overtook General Motors to regain its position as market leader. After that, to cater for demand, Volkswagen actually had to open four new plants in China
Expansion is continuing. The company announced plans to rollout more fuel-efficient vehicles to meet new regulatory standards.