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Global Development: Part II Europe
Renault

Georges Douin of Renault.
Renault is thoroughly pragmatic about the demands of its customers—and potential customers—across the world. "Those demands are very wide according to different countries," said Georges Douin, Executive Vice-President, Product and Strategic Planning and International Operations. "In fact they are so wide that although our cars are sold in 109 countries, we accept that there are some where we cannot sell any that would correspond to their needs. For example, in India, our current cars cannot fulfill the requirements of such a market. They would be too expensive and we do not have the appropriate models. It is an aspect of a global market that we cannot afford to develop."

Renault has heeded the lessons of automotive history not to try to conquer markets where its designs would be inappropriate. However, it may sometimes use its design and engineering "inappropriateness" as a plus factor, giving a vehicle niche product status. It has done so in Japan, albeit at a low level. Most of its products do not have the right specification to allow them to become established in Japan—one of the most difficult automotive markets in the world: "But we have sold left-hand drive Twingos there as niche vehicles," Douin said. "However, our Japanese sales are only about 2000 - 3000 a year. Also, sometimes we don't have the right adaptation of model for a market like Hong Kong in terms of the necessary mix of right hand drive, automatic gearbox, and a high level of air conditioning, so there, too, we just sell a few models because we do not fulfill the basic expectations of such a market so there is no point in trying to do it."

Douin does not feel that Japanese buyers are more quality conscious than those in some other markets: "Our understanding of Japanese customer quality expectations would not be higher than, say, Switzerland, which is very high, as is Germany. Paint finish, for example, would be a first concern in those countries. In fact, some years ago we had specific paint finish for several countries and sometimes we would have special workshops for a "second finish" to be sure that everything was just right; they were essential at that time."

But now things have moved ahead, and Renault, like every other international car company with any hope of survival, is well aware of the need for a high level of designed-in high quality for any and every market. "People's quality expectations are increasing," said Douin. Renaults are bought in markets as diverse as the UK, Turkey, and Brazil. "Our products are not basically different for different countries but they are adapted to individual needs of those countries. Some are very careful about safety, others are not; some regard air conditioning as a priority, others do not regard it at all," he explained.

Renault does not sell its products into the USA, so Douin can take a more independent look at emissions and crashworthiness needs than many manufacturers. He is not as hopeful as some auto industry leaders about the likelihood of worldwide agreement on emissions standards: "Agreement on emissions and crashworthiness will take a very long time and perhaps the safety issue will be solved internationally before emissions, even though today we have basically two safety standards—U.S. and European. These will, I believe, finish as an amalgamation but this will take 10 - 20 years to achieve because there are different understandings of what is needed. In effect in Europe, we have to demonstrate our cars to a regulation board and if we pass the examination we are accepted. In the U.S. it is a tougher self-certification. So the type of examinations, the behavior behind them, and the solutions, may be different. Beyond these regulations there are difficulties in countries to be solved. If the traffic and infrastructure in the U.S. and Europe are compared, it will be realized that they are so different we cannot reasonably expect to have the same safety targets."

Although Renault is not directly concerned with the U.S. because it no longer sells cars there, it does so in Latin America. "Globally, we have one definition for safety. In that respect the Megane, for example, is the same in Brazil as it is in Turkey or throughout Europe. But although a Megane may look the same in Colombia as it does in France, there are detail changes for particular markets, such as colors, interior trim, and seating materials. But build quality standards are always the same," Douin said.

It is important that vehicle manufacturers retain their national design identity, Douin added, although in Europe there is what he terms "mixing", i.e., cars like small hatchbacks—the Renault Clio, Ford Fiesta, and VW Lupo—are very much alike in many ways. "But we would not like Renault cars to be in the German style and they are not. We have our own values and we are proud to have French tastes," he said. One distinctly French model is the Renault Megane Scenic, a small multipurpose vehicle that has proven extremely popular in its native France and other areas of Europe. "But such a car could not be successful in every country; it is a little expensive for some and I do not believe it is right for mass sales in emerging countries. However, China has expressed considerable interest and Renault has been asked about the possibly of it being built there, as has South Africa. So it is proving a global car," he said.

Douin believes that the global auto industry will continue to face major challenges in the 21st century just as it has in the 20th: "I have spent 30 years in the industry and have been surprised that each year I have had to learn about a new technology or a new aspect of technology. Now, vehicles are becoming lighter in weight so there is a change of materials use, and we are seeing new levels of innovation for safety, for cost reduction, for mass production, for the hybrid and the all-electric car. The use of fuel cell technology globally? I am not too sure. But I am sure that there will always be new innovations and I am happy to see so many ahead of us—but I know that the battle to achieve success in all those areas will be even more difficult in the future than it was in the past."

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