Citroën unveils new UK strategy with price cuts and RV focus
28 October 2020
Author: Sean Keywood
Citroën has announced a new three-year plan for the UK, including cuts to list prices and efforts to improve residual values.
It is calling the new strategy Citroën Advance UK, and says it complements its current new product offensive, which includes 11 new model launches in 16 months.
The manufacturer claims that its new 'fair pricing' policy is about being transparent and upfront with customers, reducing list prices to levels closer to actual sale prices and removing the need to haggle for discounts.
The new policy will apply across Citroën's line-up from 1 December, with examples including reductions of up to £700 for the C1 city car, up to £1,175 for the C3 supermini, and up to £1,775 for the C3 Aircross crossover.
Announcing the new policy, Citroën UK managing director Eurig Druce said that while fleet customers would see fewer discounts on list price available as a result, there would be multiple other benefits.
He said: "We very much hope to see an improvement in growth and volumes of course as a result of moving to fair pricing.
"In bringing the list price down it will mean a reduction in terms of the level of discounts that we offer to our customer, but the real advantage here is in taking this approach, the cost of entry for the vehicle is lower, the residual value is stronger, and of course the Benefit in Kind payable on the P11D is lower for the driver.
"So it's a win-win-win, if you like, in terms of the fleet proposition."
Citroën says that along with the new pricing strategy, its models will switch to a new range structure, comprising Live, Sense and Shine equipment grades, with additional Sense Plus and Shine Plus also featuring with selected models.
Citroën has also announced a new range of C-Series derivatives of its cars, designed specifically for customers buying online.
These were announced with a heavy focus on retail, but will also be available to fleets, although an extended five-year warranty with the models is retail-only.
As for residual values, Citroën says these are central to its new strategy, due to the critical part they play in UK car sales, for both retail and business customers.
Druce explained: "It's an area where we have been below-par in the past. But now we have put that right, with tight control of trade-in, ensuring our customers' cars are worth at least the average of the segment after three years.
"Rental will be limited to no more than 10% of our sales. Gone are any promotions of short-term contract hire business. And through our new fair pricing strategy, giving transparent pricing, large discounts and the requirement for haggling are no longer part of the plan."
Druce said that the effects of this had been seen with the new C4 lower-medium car (pictured).
"At the launch of the new C4 we see these pillars shining through with one of the best residual values in the segment.
"By comparison to the [old] C4 Cactus, we see a gain of 12% in the three year/30,000 miles residual value. [This means] £3,500 less cost of ownership for a customer buying the car through a channel where residual value is a factor."
Druce said that Citroën's action on residual values had been positively received by industry experts.
"We've obviously shared this plan with the influencers for residual values. What they are feeding back to us is the elements of our plan are absolutely appropriate in order to improve residual values.
"We see that element of confidence come through now already with the new C4, so we've gone from a position maybe at the low end of the segment with the C4 Cactus, to one of the leading vehicles in the segment with the new C4.
"We are confident that by holding to the rules and the strategic plans we have launched, we will carry on seeing those kind of results and improvements across the whole Citroën range."