An interview with CEO Caterham cars

[viper blue]

Take a read of this article folks, an interesting interview with CC CEO

http://skiddmark.com/2013/03/caterham-cars-exclusi...

Rob

[Turn7]

Anyone know who the Motogp rider they support is ?

[factor7]

Turn7 said:

Anyone know who the Motogp rider they support is ?

Zulfahmi Khairuddin, aka "Fahmi". He rides in Moto3. AirAsia have been supporting him for a number of years now. The airline also sponsors the Japanese Moto GP and has an option to renew sponsorship of the Australian Moto GP.

So will we see a Caterham Moto bike? Probably, even if it's just a one-off promotional model (which in my opinion just about sums-up most of what I believe Fernandes' involvement with Caterham is all about).

Steve

[Turn7]

Cheers.

[BertBert]

I'm confused. Are caterham producing two new cars? The sports coupe and the caterham alpine?
Bert

[factor7]

BertBert said:

I'm confused. Are caterham producing two new cars? The sports coupe and the caterham alpine?
Bert

No, the platform is a JV between Renault and Caterham but the end products (the Renault Alpine, the Caterham) will no doubt be very different. Common parts will be used (power train, drive train etc) but styling and refinement will be down to the respective companies, as will marketing and retailing. Hence the reason why Renault are funding an Alpine-branded return to Le Mans this year.

So this is going to present yet further challenges to Caterham. Renault already enjoy an established specialist dealer network (41 Renault Sport outlets in the UK alone) and as there will be no cross-over between the two models (and with Caterham's minimal market presence), selling their variant is going to require additional significant investment and third-party participation.

Steve

[viper blue]

The interview answers from the CEO look balanced with a forward view on new models whilst retaining their seven base.
I was somewhat surprised to hear that the company had received zero investment over the last four year prior to TF taking over control. No reason really for me being surprised, guess they simply wanted to sell ASAP.
I guess if things continue then there is hope.
I was reading an article on Lotus car sales over the last couple of years, and lets say things are not looking good.
Hopefully both of these iconic car brands will see these hard times through.

Thanks for the article.

Rob

[BertBert]

I wasn't surprised to see "no investment". That's surely what happens when you buy something with Private Equity especially when it's a long-standing business. You put together the business case, the investment case, raise the money from a mixture of debt/equity/mezzanine finance and off you go.

Not sure why you should expect more "investment". It's not like the PE guys are some kind of benefical uncle that just put a bit more in.

Bert

[viper blue]

I guess the old adage of "change or die" holds today. For those who can remember Sir John Harvey Jones 's works from the 1980.
An interesting article, non the less.

[pipnjones]

The eternal puzzle.... How to grow a business in a niche, when you need to get people to find out about what you can offer, but without bankrupting yourself with the advertising.

Renault can expand and market the Alpine brand pretty easily, with relatively little risk. Caterham will have to think outside the box.

In a dream world, Caterham would buy Lotus and magically grow everything, with the Seven and Elise representing different strands of the same DNA and the bigger cars in the Lotus range being reenergised. But unrealistic.

If I was trying to think differently, I would try to create a retail set-up that joined multiple cool product types to leverage multiple brands.

Caterham.
Nespresso or perhaps preferably Bodum.
Napapijri
Bose
Bollé
Doc Martens (a name that makes me think drop some of the other suggested brands a rebuild as a "Cult of Britishness Cooperative.")

So, which small to medium-sized brands could benefit? Imagine a Superstore done up to a professional level that offers...
Caterham
Doc Martens
Arcam
Ben Sherman
Aston Martin
Dyson
Next
Pashley
AGA
World of Whiskey
A trendy food hall (for Marmite, tetley's, pork pies and Branston)
And maybe harrier jump jets hovering over the white cliffs of Dover as a man in a boxing ring challenges all comers to come and have a go...)

It must ooze Britishness, and open people's eyes.

[rubystone]

BertBert said:

I wasn't surprised to see "no investment". That's surely what happens when you buy something with Private Equity especially when it's a long-standing business. You put together the business case, the investment case, raise the money from a mixture of debt/equity/mezzanine finance and off you go.

Not sure why you should expect more "investment". It's not like the PE guys are some kind of benefical uncle that just put a bit more in.

Bert

I am pretty sure that Corvin didn't expect to have to pump money into Caged when they bought Caterham Cars. Maybe that was a contributory factor to their decision to limit investment. As someone who has worked for and sold a company asked by VCs I can assure you that the CC story is typical of a VC owned company.

[coppice]

pipnjones said:

The eternal puzzle.... How to grow a business in a niche, when you need to get people to find out about what you can offer, but without bankrupting yourself with the advertising.

Renault can expand and market the Alpine brand pretty easily, with relatively little risk. Caterham will have to think outside the box.

In a dream world, Caterham would buy Lotus and magically grow everything, with the Seven and Elise representing different strands of the same DNA and the bigger cars in the Lotus range being reenergised. But unrealistic.

If I was trying to think differently, I would try to create a retail set-up that joined multiple cool product types to leverage multiple brands.

Caterham.
Nespresso or perhaps preferably Bodum.
Napapijri
Bose
Bollé
Doc Martens (a name that makes me think drop some of the other suggested brands a rebuild as a "Cult of Britishness Cooperative.")

So, which small to medium-sized brands could benefit? Imagine a Superstore done up to a professional level that offers...
Caterham
Doc Martens
Arcam
Ben Sherman
Aston Martin
Dyson
Next
Pashley
AGA
World of Whiskey
A trendy food hall (for Marmite, tetley's, pork pies and Branston)
And maybe harrier jump jets hovering over the white cliffs of Dover as a man in a boxing ring challenges all comers to come and have a go...)

It must ooze Britishness, and open people's eyes.

I think it's a lot simpler just to buy a Seven because you like them , as I did, rather than turn it into some cliche'd retail experience.Involving several brands I have never heard of and a firm which sells bloody vacs! I do confess to a penchant for Marmite however; but AGAs are as British as Abba and whiskey as British as Guinness .....

[Noger]

pipnjones said:

The eternal puzzle.... How to grow a business in a niche, when you need to get people to find out about what you can offer, but without bankrupting yourself with the advertising.

Turn your customers into brand advocates. Get them to do the marketing.

I wonder what the Net Promoter Score of Caterham would be ?

[BertBert]

Noger said:

I wonder what the Net Promoter Score of Caterham would be ?

That could be done and would be very interesting to see what the BC community say. Now I'm not a BC member, but it would be really easy to ask the NPS question on BC or even here. Might not be the whole answer, but would be great fun!
Bert

[Noger]

Agreed

My guess would be a good NPS, but you never know.

[coppice]

Ah the good old NPS- we speak of little else in our house....

[Noger]

Personally I prefer a more actionable metric, like actual promoters. But hey

[pipnjones]

coppice said:

I think it's a lot simpler just to buy a Seven because you like them , as I did, rather than turn it into some cliche'd retail experience.Involving several brands I have never heard of and a firm which sells bloody vacs! I do confess to a penchant for Marmite however; but AGAs are as British as Abba and whiskey as British as Guinness .....

Well spotted on the Aga. I had always thought it was British. I would say that Scotland has a relatively strong claim to be at the top of the whiskey-making pile. The Irish play a bit part there.

The point here, is not what we want, but was an example of how an owner could think differently to grow a market. Either you buy a company because you love it, or because you want to make a profit. Or because you want to promote an Asian Airline. How do you get your money out of running a company like Caterham? You need to sell more cars with a clear profit margin, or push up prices, or cut corners.i hope they choose option 1. Current owners can only influence so many other people to buy. That was the thought of Shop in Shop.

You could also get creative with building a local-level servicing concept, because any decent local garage should be able to service a Caterham.

[coppice]

Ahem..Scotland makes whisky. Ireland makes whiskEy. Oh ,the joy of pedantry.

[pipnjones]

I'll get my coat...

You know, you can tell you're painted into a corner when the only way out is to invade Ireland....

Edited by pipnjones on Tuesday 2nd April 21:03