Date:10-26 08:49 Source：auto.comnews.cn Authour：He Lun
Auto Q&A No.61
Immediately after FAW Toyota announced the price of the new Crown 2.0T (starting price RMB264,800), Chang'an Ford announced the advance price of the Taurus 2.0T (starting price RMB249,800). Which one of these two close competitors will emerge the victor?
Q: The starting pre-sale price of the Taurus 2.0T is RMB15,000 lower than the Crown. What do you think of the prices?
A: The Crown is a typical mid-level C-Class car (medium and large-sized sedan or executive sedan) and also the benchmark in this segment, whereas the Taurus is a B+ Class car deriving from the B-Class (mid-size sedan) and it is similar to the Buick LaCrosse, only with a longer wheelbase. Its lower advance price reflects the low profile that a latecomer prefers to adopt, but it's hard to say whether the price is low enough to compete with the Crown.
In a comprehensive comparison, Crown has better brand force than Taurus. Both have strong points in their respective configurations, but Ford's rough craftsmanship is known to all. Setting aside the matter of its lower-priced models, even its luxury brand, the Lincoln, suffers from a reputation for poor materials and craftsmanship. When interviewed by Chinese media at the end of last year, Ford's president Kumar Galhotra said "We will be making adjustments and improvements in these areas." (seeIs Lincoln Bound to Be A Niche Brand in China?). Poor materials and craftsmanship may be acceptable on the compact Focus, but doesn't seem right on the mid-size Mondeo, and it is definitely unacceptable for the target users of the executive Taurus. But we will have to wait for the locally-produced Taurus to see what its materials and craftsmanship are really like.
Q: It's estimated that the Taurus will have an even lower price once it hits the market. What do you expect it to be?
A: I think the Taurus 2.0T's starting price will be RMB239,800 in order to maintain a gap with the Crown, but they will also compete in entry-level models. The price of the new 193hp Crown 2.5 V6 has not been announced yet. I expect it to be about RMB20,000 lower than the 235hp 2.0T, and I don't think the 181hp Taurus 1.5T will announce its price until the price of the Crown 2.5 V6 comes out. After all, Crown is the benchmark and Taurus can only be priced accordingly.
Q: The price jockeying in this segment was started by Crown. The starting price of the new Crown has dropped from RMB279,800 to RMB264,800, and the 2.5 model may well fall to RMB240,000+ if its price is lowered by another RMB10,000-20,000. As a result, the new Crown falls into the mid-level executive sedan segment and competes directly with China's Hongqi H7, whose starting price is RMB259,800. What are the prospects for the H7?
A: H7 targets the premium official car market, which Crown cannot touch, so it won't be affected too much, but mid-level high-end B-Class cars that also focus on the business and family car market will come under heavy pressure. These include the Magotan, Passat, LaCrosse, Camry and Accord, whose main models are all in the price range of RMB200,000-240,000, meaning that customers can pay an extra RMB20,000-30,000 to buy a higher-level sedan. What do you think will happen?
Q: Based on the price, the new Crown won't be competing with cars like the Audi A6L, but will it compete with the Lexus ES and Audi A4L?
A: The Lexus ES is a luxury brand that offers added values to users that are beyond the reach of the Crown, such as social status, face, and service, and the two provide a very different driving/riding experience. Although both are positioned as business & family cars, their customer demographics are quite distinct, so they won't be in direct competition. As to the A4L, it's not a business car because official and business features have become exclusive to the A6L and A8 in the Audi family. Besides, the A4L and Crown belong to two brands that are on different levels and of different origins (German VS Japanese), so they won't be in direct competition either.
Q: Shanghai VW is about to launch VW's first C-Class car. It seems the mid-level C-Class market is getting more crowded.
A: That's for sure, because Crown's most direct rival is probably coming in the shape of the "small Phaeton", and that competition will be worth waiting for. But it's hard to say how big the mid-level C-Class segment will become. The locally-produced Buick Royaum and Park Avenue, and the imported Chrysler 300C and Peugeot 607, all failed in this segment, and the benchmark Crown sells only 2000+ units per month now compared with its peak monthly sales of 6000 units. How many units of the new Crown will be sold after the price reduction? How much larger will this segment become after the entry of the VW C-Class car? We can only wait and see. But one thing is for sure - the Chinese auto market is not only the largest but will keep growing and maturing. Some of the main signs of maturity are that consumer needs and the market will become increasingly segmented, there will be more clear-cut competition among different brands, classes and types of cars, and all competitive models that meet market needs will find their niche.