Lamborghini races toward revival in Thai market
The Italian luxury automobile maker Lamborghini expects a rapid recovery in Thailand with a new partnership, a new facility and a new model, while global sales continue to rise despite economic concerns.
The new Lamborghini showroom and service centre on Vibhavadi Rangsit Road in Bangkok is the company’s largest to date.
"The potential of Thailand was not fully realised in the past two years," Federico Foschini, chief commercial officer of Automobili Lamborghini, told Asia Focus recently.
"We knew we had a problem here in terms of customer satisfaction and we have taken care of it immediately. We have fixed it with the right partner," he added, referring to the tax avoidance scandal involving unlawfully imported supercars by the former distributor, Niche Cars Co.
According to the Department of Land Transport, only two Lamborghinis were registered in the first six months of 2018 and just 14 were sold in 2017, compared with 38 the year before. The company in August appointed Renazzo Motor Co, a subsidiary of Sharich Holding, as its sole dealer and after-sales service provider in Thailand.
Lamborghini considers Thailand one of its strategic markets in Asia Pacific with a sales target of 40-50 units per year. In 2017 it sold 1,000 cars in the region, led by Japan with 411 units, followed by Greater China (319) and Australia (131). Sales rose last year to 1,301 units, out of 5,500 globally.
To mark its new partnership, the company this month opened the Lamborghini Bangkok showroom and service centre on Vibhavadi Rangsit Road. The 465-square-metre complex is the brand's largest to date and cost 150 million baht. It is expected to handle more than 1,000 cars a year including about 300 Lamborghinis registered locally.
"I think it is not a dream that this dealership, with the current three models, can sell around 50 cars per year as this is the number we have done in the past and we think we can repeat it," Mr Foschini said at the launch of the new centre.
The three models available locally are the Urus, Huracan (Evo and Spyder) and Aventador (Roadster and Coupe). The Urus is Lamborghini's first sport utility vehicle, the Huracan is its new flagship with a huge V10 engine, while the Aventador is a mid-engine option. The Aventador came out in 2011, the Huracan in 2014 and the Urus in December 2017. The latter accounted for nearly 30% of the company's total sales last year.
Mr Foschini expects Lamborghini sales to top 7,000 units this year and stabilise around that level in the near term.
While the global economy and consumer sentiment have been affected by concerns over a trade war, Brexit and other factors, Lamborghini occupies a niche that is not so "sensitive" to macroeconomic conditions, but it constantly monitors economic indicators.
"The situation in Asia is the same and we know that the overall automotive market in China might be decreasing a little bit as its GDP is not increasing as expected by the government even if it is growing by more than 6%," said Mr Foschini.
Overall car sales in China fell 13% in December, the sixth straight month of declines, bringing annual sales for 2018 to 28.1 million, down 2.8% from 2017. Forecasters expect flat growth this year. Greater China is Lamborghini's second largest market in Asia Pacific.
Mr Foschini brushed aside concerns about the Chinese economy, saying the brand has to be flexible. He cited the case in the Middle East, where geopolitical strife and the war in Yemen led the company to move a production facility from the region to Europe.
“The potential of Thailand was not fully realised in the past two years,” says Federico Foschini, chief commercial officer of Automobili Lamborghini.
"We were able to move production from the Middle East to Europe because of excess demand in Europe which was helping to compensate, for example, for the political and economic problems that we had in the Middle East in 2017, and we could do the same here in Asia Pacific but there is no need for that right now," he said.
"There are markets that are running really, really fast here and they seem to be impervious to the ongoing political and economic situation."
The company is optimistic about the prospects for the new Evo because the first iteration of the Huracan was such a "success story", he said. It outsold its predecessor, the Gallardo, by almost double within the same time frame.
"At the end of the day, the car offered extreme performance. It was extremely emotional, it was extremely reliable and it was setting a standard in the super-sport car segment with four-wheel drive, with the open version and two-wheel drive with the Performante, we were able to complete the family," he said. The Performante is the two-wheel drive option of the Huracan Spyder.
"We are always looking to surprise and innovate our product in order to always be the rule breaker … so we decided to change part of the Huracan's design to make it more aggressive," he said.
The Evo boasts improved driving dynamic control that allows for a four-wheel option for more agility and better performance in both narrow and long turns. The updated V10 engine generates 640 brake horsepower at 8,000rpm, accelerates from 0-100km/h in 2.9 seconds and has a top speed of more than 325 km/h.
Also expected to be a big selling point is powerful, all-new digital brain. The Lamborghini Dinamica Veicolo Integrata (LDVI) controls every aspect of the car's behaviour while also anticipating conditions to ensure the driver can make "the right manoeuvre at the right moment", Mr Foschini noted.
A digital 8.4-inch touchscreen in the centre console offers multi-finger gesture control and all the "infotainment" bells and whistles drivers and passengers are starting to expect in cars. That includes Apple CarPlay with smartphone integration, voice commands, navigation and entertainment including web radio and a video player.
"The interior has been changed with the huge screen in the middle of the console and the car has better connectivity with the LDVI system that actually helps the driver drive the car, and that is something that is very innovative for me," said Mr Foschini.