Volkswagen Australia says it won’t try and fight in the budget space against newer brands, because its customers aren’t looking for cheap options – they’re looking for well-specified models at good prices.
The brand has just launched the facelifted T-Cross compact SUV, which is comprised of three grades. This time around though, there are no options boxes to tick.
That makes it simpler for customers to see the value on offer, makes it easier for dealerships to order the right mix for their market area, and also helps potentially reduce wait times for specific customer orders.
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Indeed, the more richly specified T-Cross model range still plays an important role as the most affordable SUV model in the line-up, starting from just $34,990 drive-away for the base model Life.
Volkswagen Australia says it expects 50 per cent of buyers to choose the entry-level Life, 30 per cent to go for the Style, and the remaining 20 per cent to opt for the R-Line.
“Obviously, we drop a lot of dough asking customers what they want, we’re customer focused,” said Volkswagen Australia general manager of corporate communications, Paul Pottinger.
“And they’ll say, ‘this is what we want, we’d like it in the base model grade – so we’ve made that available.
“It’s almost kind of counterintuitive for us, because like in other SUVs you see our customers going for the top grades.
“Tiguan is a classic example, like 50 per cent of our Tiguan sales at any one time are 162TSI, most of which are R-Line,” he said, referring to the fact the Tiguan line-up kicks off from $43,990 plus on-roads, yet most buyers are spending at least $57,090 for the 162TSI Elegance, or even more on the 162TSI R-Line ($60,590 before on-roads).
“But here, because this is an entry car, and we think it is a really good value entry car, the majority of the customers are going to be at the entry grade.”
Volkswagen Australia has pivoted away from offering numerous option packs on many of its models, and the T-Cross is the latest to simplify its line-up with a clearer product lineup.
Volkswagen Australia product manager, Arjun Nidigallu, said making the range “really simple and straightforward” was the goal with the updated line-up, which consists of the Life ($34,990 drive-away), the Style ($39,990 drive-away) and the R-Line ($43,990 drive-away).
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“As you may remember with the outgoing model, we offered two grades, each with two optional packs with a total of eight possible combinations that you could get … we’ve dramatically reduced the complexity of our lineup, removing all the options and offering those components as standard in our lineup, and now it’s come down to three total combinations down from the eight in the previous model,” he said.
Mr Pottinger said the brand has at times been hamstrung by delays and supply issues for many of its models. Now supply is freeing up and there are no issues that are contributing to excessive wait times or de-specced vehicles, it offers the business a good opportunity to up-spec models to increase the value equation for buyers.
Mr Pottinger also called out the competition in the market, referring to the influx of newer brands that have already arrived and will offer cut-price options for buyers, not to mention more new marques on the horizon.
“If there’s a genuine midlife reinvention, then you will see it, because it’s ultra competitive out there right now,” he said.
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“We all know that, and so it’s really incumbent upon us to make sure that we do that work with the customers and get all that kit into our cars. The midlife is a real opportunity for customer and brand alike,” he said.
“When you talk about the value of this car and the price point of this car, and maybe it is comparable, and maybe there are some other new entrants into the market, and other competitors which are, on paper, slightly cheaper, but I don’t think many of them were engineered to have – for example – windshield wipers at work for 200 kilometres per hour on the Autobahn in the northern winter.
“And we might not need that, but I’m pretty glad it’s there. I think that should be part of it under consideration as well,” he said.
Stay tuned for our review on the updated T-Cross range, coming soon.
