Home News The incredible "remontada" of the Spanish car manufacturer Seat

The incredible “remontada” of the Spanish car manufacturer Seat

REPORT. Previously moribund, the brand has become the nugget of the Volkswagen group. The work, in particular, of the new boss of Renault, Luca de Meo.

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Under the sun of Barcelona, ​​in the southwest from the famous Rambla and Gaudi's Sagrada Familia, is one of the greatest prides of Catalans, taken in recent years by a fever of independence: the Seat factory in Martorell. Moribund 12 years ago, the Spanish car brand, founded in the 1950s and bought in 1986 by Volkswagen, made an incredible “rise” among European manufacturers. Like FC Barcelona's famous 6-1 against PSG in the Champions League in 2017.

The comparison with Barça is not insignificant: Seat's premium sports brand Cupra has recently become the official club partner of Lionel Messi and Antoine Griezmann. “In recent years, we have completely changed and have risen to the first division of the automotive industry”, rejoices Wayne Griffiths, vice president responsible for sales and marketing, during an exclusive interview with Le Point before the presentation of the new Leon.

Of English origin, Wayne Griffiths is one of the managers approached to succeed Luca de Meo, who takes the reins of Renault on July 1 next. Unless the latter poached this faithful lieutenant to support him within the Losange… The Leon is a car entirely thought out, designed and manufactured in Martorell. Previously underutilized, the Catalan factory, which was inaugurated in 1993 by King Juan Carlos, is now running at full speed. Around 500,000 vehicles came out of the factory in 2019, covering an area equivalent to 400 football pitches and where more than 7,000 people work. It produces the Leon, the Ibiza but also the Arona, or the Audi A1, another brand of the Volskwagen group.

Restarting the Spanish subsidiary was no small feat. “In the late 2000s, there were doubts about the very future of the brand,” says Wayne Griffiths. Seat was in the red and we had a serious positioning problem within Volkswagen, beyond being a manufacturer of inexpensive small cars. A huge amount of work had to be done to renew the range of models and to restore the brand's meaning vis-à-vis both the public and the group. Today, the Iberian company is a “gateway” for Volkswagen: its customers are on average 35 years old, 10 years younger than the rest of the company's customers.

Read also Will the Italian Luca de Meo save Renault?

Insolent growth

The incredible “ remontada” of the Spanish car manufacturer Seat

The incredible “ remontada” of the Spanish car manufacturer Seat

After a decade of losses (2007-2017), the return to profits was made through cost reductions and sales. “Our big SUV offensive, with the Ateca, Arona, and Tarraco, has paid off. Today, they represent almost half of our sales (44%). Above all, our classic models, such as the Ibiza and the Leon, have not suffered from their rise in power. On the contrary,” emphasizes Wayne Griffiths. In 2017, Seat posted an operating profit of 143 million euros, compared to a loss of 7 million a year earlier. The Iberian manufacturer goes from record to record. It shows insolent growth in a depressed market. Its sales jumped 15% in 2017, to 468,000 units. In 2018, by 10%, to 517,000 units. Last but not least, in 2019, the increase reached 11%, to 574,000 units. In the automotive industry, few brands can boast such growth rates. “This is the third year above 10%. In France we made over 20% and in Spain we are clearly the market leader ahead of PSA. We are the most trusted brand in Europe! enthused Wayne Griffiths.

While its sales still represent “only” 5% of the entire Volkswagen Group (10.8 million vehicles), Seat, which is now very profitable, makes a greater contribution to overall profits. By dissecting the annual report of the German manufacturer, we discover that the Spanish subsidiary earned an operating profit of 254 million euros in 2018. A jump of 33%. At the same time, the profits of the other brands of the multinational (Volkswagen, Audi, Skoda, Bentley) fell, apart from that of Porsche which rose slightly (+ 1%, see the table below).


The incredible “ remontada ” of the Spanish car manufacturer Seat

The incredible « remontada ” of the Spanish car manufacturer Seat

Read also “Dieselgate”: first group action in France against Volkswagen

Partner of FC Barcelona of Messi and Griezmann

Behind this spectacular recovery, we find the Italian Luca de Meo. The new boss of Renault, whose mission will be to save the losing tricolor champion, had already revived the Fiat 500 and revived Alfa Romeo. Continuing at Seat the work of his predecessor Jürgen Stackman, he completely changed the image of the Spanish brand. “Luca de Meo did an amazing job between 2015 and 2019, not just in terms of sales but in creating a clear and ambitious strategy for the company. He relaunched innovation and together we created the Cupra brand, sums up Wayne Griffiths. He leaves behind a very competent, professional and energetic team. Launched in 2018, Cupra has already found its audience. Its sporty and elegant models are a hit. It is logically this brand that was chosen to sign a global alliance with the FC Barcelona club. And it may be she who will be responsible for clearing the Chinese market if Seat decides one day to venture there…

The incredible “ rebuild” of the Spanish car manufacturer Seat

The incredible “ remontada” of the Spanish car manufacturer Seat

In a sign of newfound opulence and confidence, the Catalan firm invested more than a billion dollars to design the fourth-generation Leon and “electrify” the production lines at its Martorell factory. This week, she invited around 100 journalists to Barcelona. During a well-established show followed by a lavish reception with Iberian ham, smoked meat and exotic cocktails, it unveiled the new Leon, its best-selling car (150,000 copies in 2019). Marketed by the summer, the model with its beautiful sharp lines at the back should allow the group to consolidate its positions.

Electric scooters and urban mobility

But there is another vein on which Iberian society is working: urban mobility. It's about selling transport solutions in urban centers, where the car is no longer essential. Seat already markets electric scooters. The S brand sold 11,000 last year. “It's a paradigm shift for dealers, who must agree to no longer sell only cars but also urban mobility devices,” explains Lucas Casasnovas. He heads the new entity Seat Urban Mobility, which employs around forty people. Operating like a start-up, it has become Volkswagen's spearhead on the subject of mobility. Last year, it unveiled a model of electric scooter with interchangeable battery and Minimo, a micro urban vehicle (2.5 m by 1.2 m) for two people designed for short trips. He should be able to use the motorcycle parking spaces. His goal: to attract car-sharing companies, who can name him and dress him as they wish. The Spanish brand is also innovating in terms of the economic model. In 2019, it launched a long-term rental offer. What's new under the hood? It is non-binding and cancellable from the 1st of the month free of charge. A practice that was hardly done before.

Now in working order, Seat will have to capitalize on its achievements. Even if it means accepting growth that cannot eternally flirt with double figures. “Today, our challenge is no longer so much to make volumes, but to generate higher profitability on our cars”, concedes Wayne Griffiths. Despite the departure of “Italian strategist” Luca de Meo, the vice-president of Seat looks to the future calmly. Doesn't the sun shine 300 days a year in Barcelona?

The incredible “ reassembly” of the Spanish car manufacturer Seat

The incredible “ remontada” of the Spanish car manufacturer Seat

Teilor Stone
Teilor Stonehttps://thesaxon.org
Teilor Stone has been a reporter on the news desk since 2013. Before that she wrote about young adolescence and family dynamics for Styles and was the legal affairs correspondent for the Metro desk. Before joining The Bobr Times, Teilor Stone worked as a staff writer at the Village Voice and a freelancer for Newsday, The Wall Street Journal, GQ and Mirabella. To get in touch, contact me through my [email protected] 1-800-268-7116

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