As part of our invite to Inchape’s brand offerings (Subaru, LDV and KGM) at this year’s Fieldays, we managed to spend time over lunch with Kym Mellow, General Manager, Inchcape New Zealand and the core management team. Here’s what we discovered.
Powering Growth: Inside Inchcape’s Multi-Brand Strategy Driving Automotive Expansion
In a dynamic NZ automotive landscape, Inchcape is making significant strides by consolidating multiple brands under a single operational umbrella, a strategy designed to capture diverse market segments and accelerate growth. This “house of brands” approach, particularly evident in its New Zealand operations, leverages global expertise while tailoring offerings to local consumer needs, spanning passenger vehicles, SUVs, utilities, and new energy vehicles (NEVs).
The “Accelerate Plus” Vision: More Brands, Greater Market Share
At the core of Inchcape’s expansion is the “accelerate plus strategy,” a clear mandate to grow market share and the portfolio of brands. While the company boasts over 50 brands distributed globally, this multi-brand model is a relatively newer focus for its New Zealand arm, which has long been associated with Subaru. The strategy involves utilising skills and expertise from its wider international network, including the Australian cluster, to support brand growth and partner collaboration.
The ambition is already evident in the company’s market share targets. Having grown from a 1.3% market share with a single brand in September 2023 to achieving 4% market share with three brands by May 2025, the overarching goal is to reach a 10% market share by 2030 in each operating region. This growth is fueled by both organic development and strategic mergers and acquisitions.
Strategic Acquisitions and the NEV Push
A significant pillar of this growth strategy is the embrace of New Energy Vehicles (NEVs) and the strategic acquisition of brands that strengthen this offering. The acquisition of LDV and KG Mobility (formerly SsangYong) coincided with notable industry shifts towards the end of 2023. While acknowledging some “quality challenges” or initial underperformance with certain EV models in the past, the company views brands like LDV as a “huge opportunity”. For instance, the rebranding from SsangYong to KG Mobility (KGM) is part of a deliberate effort to elevate the brand and improve its market perception, with positive signs in growing brand awareness and vehicle quality.
This acquisitive approach is not new to the company’s global DNA. A major acquisition in South America, for example, brought approximately 25 brands into the fold, and expansion has also occurred in Indonesia and the Philippines. The company continues to actively seek opportunities in New Zealand, whether through further M&A (mergers and acquisitions) or by introducing new brands, potentially from China, where a vast number of brands exist. The strategy involves identifying market gaps where new offerings, perhaps from existing global partners like SAIC (owner of LDV), could fit.
Operational Synergies and Building for the Future
Managing multiple brands brings opportunities for operational efficiencies. The company is consolidating its operations, with all three key brands—Subaru, LDV, and KGM—now housed in the same warehouse facilities. This allows for streamlined logistics, such as consolidated parts runs to dealers who carry multiple brands from the portfolio. To accommodate this growth, physical refits of current office space is also underway.
The “accelerate plus” strategy is not just about numbers; it’s about building a sustainable and adaptable business. This includes “bringing in new brands and also measuring acquisitions” and attracting talent to execute this vision.
Balancing Legacy with Innovation
While the focus on NEVs and new brand acquisitions is strong, the Inchcape emphasises that this does not come at the expense of its established, legacy brands. Subaru, for example, demonstrated resilience by achieving a 2.2% sales increase in a market that declined by 15% in the previous year, and has continued to show volume growth. The strategy is to grow and optimise these traditional brands alongside the newer entrants, ensuring a comprehensive portfolio that caters to a wide spectrum of customer preferences and loyalty.
Inchcape sees a future where a diverse portfolio, strong partnerships across various sales channels (including fleet, government, and mobility services), and a commitment to raising the profile of all its brands will drive continued success. This multi-faceted approach, blending strategic acquisitions with organic growth and operational efficiency, positions the company for a dynamic future in the evolving automotive market.
