CEO: Qoros has well-designed models; now it must create a brand identity
Qoros Automotive Co. has yet to transform itself from an engineering company into a business operation, CEO Phil Murtaugh said last week at the Shanghai auto show.
"Qoros was formed in 2007. From 2007 to 2014, Qoros was a product development company. All they did was engineering, and they did a fabulous job," Murtaugh said.
In 2013, Qoros became a joint venture between China's Chery Automobile Co. and Kenon Holdings of Singapore. That same year, the company launched its first product, the Qoros 3 compact sedan.
A hatchback version went on sale last July, and in December, the company introduced a compact SUV. The Shanghai auto show marked the debut of the Qoros 2, a small plug-in hybrid SUV concept.
It's all very well to design these vehicles, but now Qoros must figure out how to produce and sell them at a profit, Murtaugh said.
"When you finish a project, you have to generate revenue and control cost," he said. "You have to run the business. I think where we went wrong was we have never made that transition from an engineering company to an operating business."
By one measure, Qoros has made progress designing vehicles that can compete in global markets.
In 2013, the Qoros 3 compact sedan received a five-star rating in the Euro New Car Assessment Program crash test. It was the highest rating achieved in overseas crash tests by a Chinese brand.
Despite the impressive test results, sales have remained sluggish. In 2014, Qoros sold only 6,967 vehicles. And in the first two months of this year, sales were less than 1,700 vehicles, according to LMC Automotive, a market research company.
In February, Qoros overhauled its management. Murtaugh, a former chief of General Motors China, was named CEO. And Sun Xiaodong, a former sales chief of Shanghai GM, was named vice president for marketing and sales.
Qoros knows which customers it wants to appeal to, Murtaugh said.
"We are targeting young, 35-ish professional educated people -- married or single," he said. "We are now undertaking a study to truly understand what drives these customers -- what they like and what they want, and what we have to do to satisfy them."
But he said Qoros must fix its muddled brand identity.
"Depending on who you are talking to, Qoros is a German designed car or a Chinese designed car -- an international brand or a Chinese brand," Murtaugh said. "We have to fix that miscommunication and relaunch the brand properly."
In 2013, Qoros became a joint venture between China's Chery Automobile Co. and Kenon Holdings of Singapore. That same year, the company launched its first product, the Qoros 3 compact sedan.
A hatchback version went on sale last July, and in December, the company introduced a compact SUV. The Shanghai auto show marked the debut of the Qoros 2, a small plug-in hybrid SUV concept.
It's all very well to design these vehicles, but now Qoros must figure out how to produce and sell them at a profit, Murtaugh said.
"When you finish a project, you have to generate revenue and control cost," he said. "You have to run the business. I think where we went wrong was we have never made that transition from an engineering company to an operating business."
By one measure, Qoros has made progress designing vehicles that can compete in global markets.
In 2013, the Qoros 3 compact sedan received a five-star rating in the Euro New Car Assessment Program crash test. It was the highest rating achieved in overseas crash tests by a Chinese brand.
Despite the impressive test results, sales have remained sluggish. In 2014, Qoros sold only 6,967 vehicles. And in the first two months of this year, sales were less than 1,700 vehicles, according to LMC Automotive, a market research company.
In February, Qoros overhauled its management. Murtaugh, a former chief of General Motors China, was named CEO. And Sun Xiaodong, a former sales chief of Shanghai GM, was named vice president for marketing and sales.
Qoros knows which customers it wants to appeal to, Murtaugh said.
"We are targeting young, 35-ish professional educated people -- married or single," he said. "We are now undertaking a study to truly understand what drives these customers -- what they like and what they want, and what we have to do to satisfy them."
But he said Qoros must fix its muddled brand identity.
"Depending on who you are talking to, Qoros is a German designed car or a Chinese designed car -- an international brand or a Chinese brand," Murtaugh said. "We have to fix that miscommunication and relaunch the brand properly."
