[On Seat 07] MG – From a Widely Criticized Car Brand to Impressive Sales Figures and the Opportunities for MG7 in Vietnam

Host Đăng Việt had an insightful conversation with automotive expert Đoàn Anh Dũng about the topic “Why MG Succeeded in Vietnam and Will MG7 Follow in the Footsteps of Its Predecessors?”

MG announced selling 10,000 cars in 12 months (July 2023-June 2024). What, in your opinion, are the reasons for MG’s impressive sales figures, Mr. Dũng?

Selling 10,000 cars in a year is remarkable. Not only new car brands but even established brands with stable sales volumes aim for such numbers for their flagship models.

Based on my years of observing the car market, I believe there are three main reasons behind MG’s success.

Firstly, MG adopted a multi-level dealership approach, establishing a wide network of small and large dealerships. While these smaller dealerships may not focus heavily on sales, they build brand awareness and provide customers with peace of mind regarding warranty and maintenance services.

Secondly, and most importantly, is their product strategy. A car brand’s success heavily relies on offering products that resonate with consumers, creating momentum for future sales.

Lastly, we cannot overlook the country of origin factor. Initially, MG imported cars from China, which raised doubts among Vietnamese customers. However, they have since increased imports from Thailand, addressing two key concerns. Firstly, Thai-made products are generally perceived more positively by Vietnamese consumers, and secondly, banks are more inclined to provide loans for cars originating from Thailand.

MG’s decision to shift their sourcing from China to Thailand demonstrates their commitment to adapting to the local market. Thai factories primarily produce right-hand drive cars, but they added left-hand drive production lines to cater to the Vietnamese market, indicating their dedication to capturing the local market.

MG recently partnered with Haxaco to expand its dealership network. What are your thoughts on this move, Mr. Dũng?

The collaboration between MG and Haxaco signals a shift in the brand’s business strategy. MG initially entered the market with B-C segment cars, offering competitive pricing and decent specifications. In contrast, Haxaco is known for its association with the luxury brand Mercedes-Benz.

This partnership suggests that MG aims to elevate its brand image and prepare for the introduction of more premium offerings. By working with Haxaco, MG can gain insights into the preferences and expectations of premium car buyers, allowing them to strategically position their future models to cater to this segment.

However, this doesn’t mean that MG will neglect their lower-priced models.

The recently launched MG7 is a step towards offering more premium models. The media often describes it as a “viewable” car. What are your thoughts on this, Mr. Dũng?

I believe the MG7 is generating positive “views” and buzz. MG has already proven its success with the MG5 and MG ZS, delivering exceptional value for money. As a result, there is a lot of anticipation and expectation surrounding the MG7, with people hoping that it will offer a similar balance of affordability and feature-rich offerings.

Do you think the formula for MG5’s success can be replicated with the MG7, Mr. Dũng?

The formula can be applied, but it requires adjustments. The Vietnamese automotive market is discerning, so upgrading to a higher-end model demands careful research and understanding of the target audience.

For the MG5 and MG ZS buyers, direct communication and hands-on experiences are key. Customers need to physically interact with the car, forming their own opinions about its features and value proposition.

For the MG7, while maintaining a direct approach, the brand needs to highlight unique selling points that set it apart from competitors in the same segment or price range.

Vietnamese car buyers are meticulous, considering not just the purchase price but also running costs, maintenance, and after-sales service. Therefore, introducing a premium model necessitates creating a unique value proposition that resonates with the intended audience.

So, what are the key factors that will contribute to the success of MG7 in Vietnam, in your opinion, Mr. Dũng?

Firstly, and most importantly, MG needs to maintain its focus on offering value. The MG7 is positioned to compete in the large sedan segment, and if they can price it competitively, as they did with the MG5, I believe it will be a success.

Secondly, MG should emphasize the unique features and value propositions of the MG7 compared to its competitors. For instance, they could introduce a standout feature, similar to BMW’s Gesture Control, which adds a unique touch, even if its practical application is limited.

Lastly, MG’s strong after-sales service is already well-known. Their previous models offered unlimited mileage warranties and five years of free maintenance. Extending this policy or introducing a similar customer-centric initiative for the MG7 would be a smart move.

MG seems to have a strong presence in the provincial markets, with a significant number of their cars spotted on the roads. How does this impact their business strategy for the MG7?

To answer this, I’d like to share a real-life story.

I have a friend who works as a sales consultant for an MG dealership in the provinces. When the dealership first opened, the director gave him a daily allowance of 100,000-200,000 VND to drive test cars to local cafes. His job was to engage with cafe patrons, invite them to experience the MG cars, and then discuss the competitive pricing.

This direct marketing approach allowed potential customers to form their own opinions about the car’s value proposition. One such customer, a father buying a car for his child studying in Hanoi, shared his thoughts: “For around 500 million VND, I can get a raised car to navigate Hanoi’s flooded roads and for trips back to our hometown. Moreover, the five-year free maintenance is a huge plus.”

I commend the dealership director’s strategy, as it creates a personal connection with potential buyers, something that traditional advertising may struggle to achieve.

Thank you, Mr. Dũng, for your valuable insights.