The rise of DPCA is only a flash in the pan?

2022 is the 30th anniversary of the establishment of DPCA, in the year of its establishment, DPCA has also ushered in a transformation, a series of strategic adjustments have been made within the company, and the market performance is gradually rising, and the sales volume in January-April this year also increased by 57.7% year-on-year. In addition, the sales volume of DPCA also achieved positive year-on-year growth for 17 consecutive months.

It should be known that due to the recent outbreak of the epidemic, lack of core and raw material prices and other unfavorable factors, the trend of the entire automotive industry is not optimistic, and the decline in the performance of car companies is the norm. The sales data of DPCA automobile can go all the way up, which is really not easy. However, at the time when the sales of DPCA cars are rising, the hidden worries behind them cannot be ignored.

The reform strategy has borne fruit, and sales have continued to rise

In the mainland auto market, DPCA is the most successful French brand. Now Renault and DS have withdrawn from the Chinese market, leaving only citroen and Peugeot, two French car companies under DPCA, and the market performance of DPCA is getting better and better. From the end of 2020, the sales of DPCA began to slowly pick up, and the total sales volume in 2021 ended with more than 100,000 units.

By 2022, DPCA released the latest data showing that the cumulative sales volume from January to April 2022 was 39632 units, an increase of 57.7% from 25134 units in the same period of 2021, of which April sales were 9316 units, an increase of 22.7% from 7595 units in the same period of 2021. Such a dazzling growth rate is on the one hand because the sales base of the earlier is too low, and on the other hand, the reform strategy of DPCA has achieved phased results.

As we all know, the market performance of DPCA has declined from 2016 until 2019. In the face of declining sales, DPCA had to save itself, so it launched the yuan revival plan in 2019, but the plan failed to save sales, and in 2020, DPCA released the yuan + plan to reverse the decline in sales, and at the end of the year, it achieved positive year-on-year sales growth for the first time. It is reported that the slogan of the Yuan + plan is that the products are more Chinese, the marketing is more accurate, the service is more reliable, and the operation is more efficient. In other words, DPCA's products, marketing, services and operations are more Chinese, and they have a deeper understanding of Chinese consumers' car buying preferences than before. At that time, DPCA was also brewing the Versailles C5X, which has become the sales pillar of the brand.

Until 2022, the two-room and one-hall plan of Dongfeng Peugeot motor has also been officially landed, two of which refer to Dongfeng Peugeot will be led and controlled by the French Stellantis Group, Dongfeng Citroen will be dominated and controlled by the Chinese Dongfeng Company, and the first hall refers to the sharing of existing public areas such as commodity planning, technology, quality, and industrial production, so as to achieve the purpose of efficient utilization of resources.

Because of the results of the adjustment plan, DPCA is also full of confidence in the future, and said at the beginning of this year that sales will reach 170,000 vehicles in 2022, challenging 200,000 vehicles. This sales target is not conspicuous among mainstream brands, but it is already a nearly double achievement for DPCA.

In the view of the car buyer, it is difficult for DPCA to achieve the sales target of 170,000 vehicles, the total sales of DPCA in 2022 is less than 40,000, then in the next 8 months, the average monthly sales of DPCA will reach more than 16,000 to complete the target of 170,000 vehicles, taking into account the epidemic, the shortage of parts supply and other external factors, as well as the shortcomings of DPCA's products, whether the monthly sales of DPCA can break through 10,000 is unknown.

There are also many hidden worries behind the bright results

At present, DPCA's products in China are not small, Peugeot brand has a new 5008, a new 4008, 2008, 508L, 408 and other models, Citroën has Tianyi C5 AIRCROSS, the new C3-XR, Versailles C5X, C6 and other models, but no model has a monthly sales of more than 5,000 vehicles, the best model at present is the Versailles C5X that entered the market in 2021, and the sales of this car exceeded 5,000 units for two consecutive months at the end of 2021. The retail sales in March this year were also close to 5,000 vehicles, which is already the peak performance of DPCA's products, so the Versailles C5X was once regarded as the savior of DPCA.

From the Versailles C5X can indeed see the determination of DPCA to change, first of all, the model name is a network hot word, easy to leave an impression on consumers. Then there is the high cost performance of the vehicle, the market price of the compact car, providing the comfort and advanced texture of the mid-size car, while also having a certain driving pleasure, so the Versailles C5X has won the favor of many consumers after entering the market.

However, with the increase in the market ownership of Versailles C5X and frequent thunderstorms in product quality, more and more owners reflect that their Versailles C5X has encountered problems such as body resonance, engine shaking, and trunk failure, and with the continuous fermentation of quality control problems, the market heat of Versailles C5X has gradually declined.

Obviously, if there is a sales crisis in the Versailles C5X, it will have a great impact on the market performance of DPCA. For DPCA, it is not only necessary to solve the quality problems of the Versailles C5X and boost consumer confidence, but also to launch more powerful products to stabilize the market situation. After all, the current competition in the mainland automotive industry is becoming more and more fierce, independent brand online, joint venture products, coupled with cross-border car manufacturing, DPCA only relies on versailles C5X a main model to fight the world is inevitably too risky.

It is a pity that at present, DPCA does not have a clear product promotion plan, even in the face of the hot new energy vehicle market, DPCA's attitude is not positive. Earlier, the Parent Company of DPCA's joint venture in China, Stellantis Group, held a Strategic Planning Conference for Dare Forward 2030, although it was proposed that by 2030, the Group would have more than 75 pure electric models, and the annual sales of pure electric vehicles in the world would reach 5 million, but the electrification strategy in China was nothing to mention, and there was no new fuel model planning. This can't help but make people speculate that stellantis Group has no intention of reviving DPCA and will not put more resources into DPCA. If DPCA loses the support of its parent company, The Stellantis Group, the road ahead will be more dangerous.

In fact, the practice of Stellantis Group is not difficult to understand, even if the Chinese market is the world's largest automobile market, full of opportunities, but the performance of Stellantis Group in China is not ideal, in 2021, Stellantis Group's DPCA and GAC FCA annual sales are only 100,000 and 20,000 vehicles, respectively, compared with the mainstream brand monthly sales. In the north American and European markets, however, it can bring considerable sales figures and profits, so the Stellantis Group pays more attention to overseas markets.

As for China, Stellantis Group wants to reduce losses by saving money, and made it clear at the Dare Forward 2030 strategic planning conference that it will adopt an asset-light business model in China to reduce fixed costs, resulting in net revenue of 20 billion euros. In the future, DPCA should not have much investment in product research and development, service channels, marketing management, etc., in this case, how to talk about boosting sales?

In fact, French car companies also had a highlight moment in the domestic market, once the annual sales exceeded 700,000 vehicles, successfully squeezed into the camp of first-line joint venture car companies, but unfortunately, the product design of French cars is more unique, coupled with the slow speed of new cars pushed, as well as the existence of imperfect service channels, the performance of French cars in China shows a state of high driving and low walking.

It wasn't until the arrival of the Versailles C5X that sales of French cars could be boosted to some extent. However, the quality of this car is not reassuring, and DPCA also lacks effective solutions, and in the long run, the good sales performance of the Versailles C5X will only be short-lived. The Stellantis Group also has no plan to focus on the Chinese market, which will also have a great impact on the development of DPCA, and it will be very difficult for DPCA to return to the peak of sales in the future.