Rebranding (automobile)

  (Redirected from Rebadging)

Rebranding in the automotive industry is a form of market segmentation used by automobile manufacturers around the world. To allow for product differentiation without designing or engineering a new model or brand (at high cost or risk), a manufacturer creates a distinct automobile by applying a new badge or trademark (brand, logo, or manufacturer's name/make/marque) to an existing product line.[1][2]

The Peugeot 107 and Citroën C1 look very similar, and most of their construction parts are identical.

Rebranding is also known as rebadging and badge engineering; the latter is an intentionally ironic misnomer, in that little or no actual engineering takes place.[3][4] The term originated with the practice of replacing an automobile's emblems to create an ostensibly new model sold by a different maker. Changes may be confined to swapping badges and emblems, or may encompass minor styling differences, as with cosmetic changes to headlights, taillights, front and rear fascias and outer body skins. More extreme examples involve differing engines and drivetrains. The objective is "to spread the huge development costs of a new vehicle over as many cars as possible."[5] An example is General Motors' rebadging of the Camaro as the Firebird, a successful model from the 1970s through to the 2000s.[6] In most cases, consumers are interested on each brand's focus "on the unique elements of styling and driving characteristics."[5] Some cars would not be marketed without the cost savings that are obtained from this practice and carmakers can develop many "different models — all wearing different badges — off the one platform."[7]

In several countries including Japan, manufacturers often use the phrase "OEM supply" or "OEM-supplied" to denote vehicles that is a rebadged model from or for other manufacturer.[8][9][10]

Although platform sharing can often involve rebranding and rebadging, it can also extend further, as the design may be used across multiple configurations. For example, a single platform may underpin a sedan, hatchback, or SUV/CUV body designs.

Automotive industry rebranding can be compared with white-label products in other consumer goods industries, such as consumer electronics and power tools.

HistoryEdit

The first case of badge engineering appeared in 1917 with the Texan automobile assembled in Fort Worth, Texas, that made use of Elcar bodies made in Elkhart, Indiana.[11][12]

"Probably the industry's first example of one car becoming another" occurred in 1926 when Nash Motors' newly introduced smaller-sized Ajax models were discontinued in 1926 after over 22,000 Ajax cars were sold during the brand's inaugural year.[13] The chairman and CEO of the company, Charles W. Nash, ordered that the Ajax models be marketed as the "Nash Light Six", Nash being a known and respected automobile brand.[14] Production was stopped for two days so Nash emblems, hubcaps and radiator shells could be exchanged on all unshipped Ajax cars.[13] Conversion kits were also distributed at no charge to Ajax owners to transform their cars and protect the investment they had made in purchasing an automobile made by Nash.[15]

Starting with the beginning of General Motors in 1923, chassis and platforms were shared with all brands. GMC, which historically was a truck builder, began to offer its products branded as Chevrolet, and vehicles produced by GM were built on common platforms shared with Chevrolet, Buick, Oldsmobile, and Cadillac. Exterior appearances were gradually upgraded between these vehicle brands. For 1958, GM was promoting their fiftieth year of production, and introduced anniversary models for each brand; Cadillac, Buick,[16] Oldsmobile, Pontiac, and Chevrolet. The 1958 models shared a common appearance on the top models for each brand; Cadillac Eldorado Seville, Buick Roadmaster Riviera, Oldsmobile Starfire 98, Pontiac Bonneville Catalina, and the Chevrolet Bel-Air Impala.

1958 Chevrolet Bel Air Impala Convertible
1958 Pontiac Bonneville
1958 Oldsmobile 98 Convertible
1958 Buick Roadmaster Riviera
1958 Cadillac Eldorado

A later example was Wolseley Motors after it was bought out by William Morris. After World War I, "Wolseley started to lose its identity and eventually succumbed to badge engineering."[17] This was repeated with the consolidation of Austin Motor Company and the Nuffield Organisation (parent company of Morris Motors) to form the British Motor Corporation (BMC). The rationalization of production to gain efficiencies "did not extend to marketing" and each "model was adapted, by variation in trim and accessories, to appeal to customer loyalties for whom the badge denoting the company of origin was an important selling advantage ... 'Badge Engineering', as it became known, was symptomatic of a policy of sales competition between the constituent organizations."[18] The ultimate example of BMC badge engineering was the 1962 BMC ADO16 which was available badged as a Morris, MG, Austin, Wolseley, Riley and the upmarket Vanden Plas. A year earlier the Mini was also available as Austin, Morris, Riley, and Wolseley - the latter two having slightly bigger boots.

ExamplesEdit

Regional brandsEdit

Badge engineering often occurs when an individual manufacturer, such as General Motors, owns a portfolio of different brands, and markets the same car under a different brand. It may be done to expand the ranges of different brands in one market without developing completely new models, such as selling one car as a Chevrolet, a GMC and a Cadillac by GM in the United States; for example, the Chevrolet Tahoe, GMC Yukon and the Cadillac Escalade.

It may also be done to sell the same model in different regions and markets simply under a different name. For example, cars built by Daewoo, now owned by GM, are no longer badged as Daewoos. Instead, they are now badged as Chevrolets. Similarly, in Australia and New Zealand, where Daewoo was unsuccessful, they were rebadged as Holden models. The Australian car manufacturing industry experienced major badge reengineering during the 1980s and 1990s as part of the failed Button car plan.

Brand expansionEdit

Another way badge engineering may occur is when two separate companies trade off products that each brand lacks in its line-up. A prime example of this would be the first-generation Honda Odyssey being rebadged as an Isuzu Oasis because Isuzu needed a minivan, while the Isuzu Rodeo was rebadged as the Honda Passport because Honda had the need for an SUV. Another example is the Mitsubishi GTO/3000GT, which was sold as the Dodge Stealth in the North American market. Vauxhall/Opel used badge-engineering for many years for their entire range of medium commercial vehicles, selling several models of Renault vans.

Distribution networks (Japan)Edit

In Japan, automobile manufacturers differed in the marketing of their product ranges. In contrast to marketing a single-vehicle under multiple brand names (with minor changes to exterior bodywork), Japanese manufacturers marketed vehicles through multiple sales networks, with a distinct vehicle being sold under multiple model nameplates (from a single manufacturer).

Toyota marketed the Corolla in Japan exclusively at Toyota Corolla Store locations; at Toyota Auto Store locations, it was named the Toyota Sprinter. Nissan sold the Nissan Cedric through its Nissan Bluebird Store network, with the identical Nissan Gloria through at the Nissan Prince Store network. Honda previously marketed the Honda Accord through multiple sales networks, marketing the Accord through the Honda Clio network and renaming it as the Honda Vigor for Honda Verno locations (conversely, the Vigor was renamed the Honda Inspire for the Clio network).

The practice of producing multiple versions of the same vehicle would eventually lead to distinct vehicles produced for export. In North America, the Toyota Sprinter was marketed as the Chevrolet Nova (and the Geo Prizm that replaced it). The Honda Vigor and Inspire were marketed as the Acura Vigor and TL; Nissan sold the Gloria in the United States as the Infiniti M45.

Joint venturesEdit

Two different automakers can also pool resources by operating a joint venture to create a product, then selling it each as their own. For example, General Motors and Toyota formed NUMMI. The vehicles produced from this venture (though not necessarily at NUMMI itself) included the Toyota Sprinter/Chevrolet Prizm, and later the Toyota Matrix/Pontiac Vibe.

Another example was the cooperative work between Volkswagen and Ford to develop the VW Sharan, Ford Galaxy, and SEAT Alhambra.

Badge engineering may occur when one company allows another, otherwise unaffiliated, company to market a revised version of their product through an OEM deal, as with Volkswagen marketing a revised version of the Dodge Caravan and Chrysler Town and Country minivans as the Volkswagen Routan (2009–2014). Another example was the joint venture of Mitsubishi and Chrysler that resulted in vehicles produced by Diamond-Star Motors that were marketed under various nameplates from 1985 to 1993.

Chrysler Town & Country
(fifth generation)
Dodge Grand Caravan
(fifth generation)
Lancia Voyager

ChinaEdit

In China, foreign manufacturers were required to form a joint venture with a local manufacturer to manufacture automobiles in the country.[19] Prior to 2022, the Chinese government dictates that no more than two joint ventures are allowed for each foreign investor.[20] Larger foreign manufacturers often set up two joint ventures to maximize the market reach, including Toyota (FAW Toyota and GAC Toyota), Ford (JMC-Ford and Changan Ford), Volkswagen (SAIC-VW and FAW-VW) and Honda (Dongfeng Honda and Guangqi Honda). To distribute the production and sales rights to each joint venture, manufacturers often resort to a similar strategy deployed in Japan, which is simply producing the same model under two different names with minor changes to exterior bodywork.

GAC Toyota has produced the Levin as a twin model to the FAW Toyota-built Corolla, and the Wildlander as the alternative to the RAV4. Honda awarded several models to two joint ventures, which spawned the Breeze from the original CR-V, the Elysion from the Odyssey, the XR-V from the Vezel, and others.

In other cases, foreign manufacturers may also rebadge a model developed by its partner, sometimes for exports to other markets. Examples include the second generation Chevrolet Captiva which is an export version of the Baojun 530 made by SAIC-GM-Wuling, or the Ford Territory, a reworked version of the Yusheng S330 developed by Jiangling Motors (JMC).

Life cycle extensionEdit

Badge engineering could be used as a strategy to lengthen the life cycle of a vehicle. After a product had reached the end of its life cycle, it may be transferred to another brand, mostly from the same holding company or joint venture. Examples including the SEAT Exeo, a rebadged Audi A4 B7 with reworked styling, which was built in Spain from used production tooling from Audi plant in Ingolstadt after the A4 B7 production has ended. The tooling was dismantled from Ingolstadt and was sent to SEAT manufacturing plant in Martorell, Spain to be re-installed.[21][22] Another example is the Dongfeng Fengdu MX6 which was produced after the near-identical Nissan X-Trail (T31) production has ended,[23] and the Maruti Suzuki Zen Estilo, which is based on the then-recently discontinued Suzuki MR Wagon. The advantage of this strategy is amortized tooling costs, which meant the vehicle could be sold at a lower price than before.

Dongfeng Fengdu MX6

Luxury vehiclesEdit

Badge engineering occurs in the luxury-type market segments. An automobile manufacturer will use a model from its mainstream brand, upgrade it with more features, technology, luxury, and/or style, then market it as a more expensive model under a premium marque. The luxury models may have more than just cosmetic differences; they may receive improved engines and drivetrains.

An example of this is that the Ford Motor Company took its well-known Ford Fusion, and sold it as the Lincoln MKZ, or the Ford Expedition being sold as the Lincoln Navigator. Another example is General Motors rebadging the Chevrolet Tahoe, a shorter version of the Suburban, as the Cadillac Escalade and GMC Yukon. An example of "Fake Prestige" was the Cygnet city car marketed by Aston Martin, with a price of more than $45,000 in its most basic version, but the vehicle was actually the Toyota iQ and, except for the Cygnet's special trim and special luggage set, sold for $17,000.[2][24][25]

The business strategy of Volkswagen is to standardize platforms, components, and technologies, thus improving the firm's profitability and growth.[26] For example, Audi uses components from their more pedestrian counterparts, sold as Volkswagen Group's mass-market brands.[27] As an effort to place Audi as a "premium" marque, Volkswagen introduces new technologies in Audi-branded cars before fitting them to mainstream products (such as the Direct-Shift Gearbox). Nevertheless, Volkswagen uses platform sharing extensively. For example, the basic A platform underpins the Golf, Jetta, New Beetle, Audi TT, and A3, SEAT Leon, and Toledo, as well as the Škoda Octavia, while the "top end" D platform served the VW Phaeton and Bentley Continental GT in steel form and the Audi A8 in aluminum form during the 2000s.[28]

Japanese carmakers have followed this practice of rebadging as well, such as Honda's Acura line, Nissan's Infiniti brand, and Toyota's Lexus marque, as the entry-level luxury models were based on their mainstream lineup. For example, the Lexus ES shares the drivetrain and is based on the same platform as the Toyota Camry[29] (and from the 2013 model year, on the stretched version used by the Avalon[30]); the Lexus LX is an upgraded rebadge of the Toyota Land Cruiser, and the Acura TSX is a rebadge of the JDM Honda Accord.

Problems and controversyEdit

Although intended to save development costs by spreading design and research costs over several vehicles, rebranding can also become problematic if not implemented properly. The use of multiple car brands under a single parent manufacturer can greatly increase selling costs. as each model line must be marketed separately and can require a distinct dealership network. The poor use of rebranding can also hurt overall sales by resulting in "cannibalism" between two or more brands owned by the same company by failing to develop a distinct image for each brand or by allowing the market failure of one version of a model to carry over to its rebadged model counterparts

Through the 2000s, the Big Three automakers reduced their brand footprint by closing or selling underperforming brands. Chrysler discontinued its Plymouth brand after the 2000 model year, with General Motors discontinuing its Oldsmobile brand after 2004 (the oldest American brand at the time). In response to the late 2000s recession, Ford ended its ownership of Jaguar, Land Rover, Aston Martin, and Volvo Cars; in 2010, Mercury was phased out. In 2010, GM closed its Pontiac, Saturn, and Hummer divisions (the latter two, its newest brands); its European Opel and Vauxhall brands were sold in 2017.

GM X/H platform compactsEdit

In response to the 1973 oil crisis, General Motors began to expand fuel-efficient offerings beyond its Chevrolet division, reintroducing compact cars to its Buick, Oldsmobile, and Pontiac divisions. Derived from the X-platform Chevrolet Nova, the Pontiac Ventura was introduced for 1971, with the Buick Apollo and Oldsmobile Omega introduced for 1973. While mildly distinguished by divisional trim, the four X-platform vehicles (also known as N-O-V-A from the first letters of their model names) were produced with nearly identical bodies.

To expand its footprint in the subcompact segment, the H-body Chevrolet Vega was given a new body for the 1975 model year and offered by Chevrolet (as the Monza), Buick (as the Skyhawk), Oldsmobile (as the Skyhawk), and Pontiac (as the Sunbird). While slightly better distinguished than the X-body vehicles, the H-body subcompacts each shared a common roofline across all four divisions.

GM divisional enginesEdit

Prior to 1981, the majority of General Motors vehicles were produced with engines designed by their respective divisions. From 1981 onward, GM ended its policy of divisionally-developed engines, instead offering engines under a singular GM brand. However Cadillac still offers division-unique engines (the Northstar and current Blackwing V8 engine families).

In 1981, GM lost a 1977 lawsuit related to consumers who purchased 1977 Oldsmobile Delta 88s equipped with a 350 cubic-inch Chevrolet small-block engine instead of the identical-displacement Oldsmobile V8 engine.[31] At the time of production, GM had downsized its full-size model lines in preparation for another oil crisis and had increased production of V6 engines as the intended standard engine, underestimating consumer demand for Oldsmobile V8 engines. To accommodate the increased market demand, nearly 60% of Delta 88s were equipped with a Chevrolet 5.7L V8 for 1977.[31] The lawsuit was filed by the state of Illinois, claiming GM falsely advertised the vehicles.[31] In 1981, GM settled the lawsuit with the vehicle buyers and discontinued their company-unique policy of division-specific engines.[32] Into the 1990s, GM advertising featured a disclaimer stating '"Oldsmobiles (or other GM division) are equipped with engines manufactured by various GM divisions, subsidiaries and affiliates worldwide."'

Lincoln Versailles and Cadillac CimarronEdit

 
1979 Lincoln Versailles
 
1987-1988 Cadillac Cimarron

Prior to the mid-1970s, the American luxury brands Lincoln and Cadillac offered model lines entirely of full-size sedans. At the beginning of the decade, the BMW Bavaria/3.0Si, Jaguar XJ6/XJ12, and Mercedes-Benz S-Class (W116) began sale in North America, competing against American luxury brands in price. Sold as full-size sedans in Europe, the model lines were multiple feet shorter than the Cadillac Sedan de Ville and Lincoln Continental (both rivaling the Rolls-Royce Phantom V in length and width). In response to both the 1973 oil crisis and the introduction of European luxury sedans, Lincoln and Cadillac introduced smaller model offerings through the use of rebranding divisional counterparts, resulting in the most controversial uses of rebranding in automotive history.

For the 1977 model year, Lincoln introduced the Lincoln Versailles compact sedan (at the time, its smallest vehicle ever produced). Intended as a direct competitor for the Cadillac Seville, the Versailles was a rebranded version of the Ford Granada and Mercury Monarch, adopting the features of the Mercury Grand Monarch Ghia. Sharing nearly its entire body (with the exception of its grille, headlamps, and trunklid) with the Monarch sold in the same showroom, the Versailles was priced as the most expensive Lincoln sedan. While sharing its chassis with the Chevrolet Nova, the Seville shared no visible bodywork with its Nova counterpart. The Versailles sold far under sales predictions, outsold by the Seville nearly three-to-one; early in the 1980 model year, the Versailles was discontinued. For the 1982 model year, the Lincoln Continental was repackaged as a mid-size sedan (becoming a four-door version of the Lincoln Mark VII, introduced for 1984), sharing no body panels with Ford or Mercury vehicles.

For the 1982 model year, Cadillac introduced the Cadillac Cimarron subcompact sedan (its smallest vehicle since 1909). To compete more closely against compact European executive sedans (sold as compact luxury cars in North America), General Motors rebranded its J-body Chevrolet Cavalier four-door sedan as the Cimarron. Originally intended for use by Chevrolet, Buick, Oldsmobile, and Pontiac in North America and Opel and Vauxhall in Europe, the J-platform began development in 1976 to shift GM subcompacts to front-wheel drive. In what was a fatal flaw to the design, the model line was approved in early 1980 (only a year before the model line was to go on sale), leaving designers essentially no ability to make changes to the design. Priced nearly twice as high as its Chevrolet counterpart, the Cimarron was nearly visually identical to the Cavalier; for a lower price, a J-body vehicle from Chevrolet, Buick, Oldsmobile, and Pontiac could be equipped with nearly identical features as the Cimarron. Following the 1988 model year, the Cimarron was discontinued; Cadillac has not produced a direct successor to the model line.

While the Lincoln Versailles was largely forgotten after its discontinuation, the Cimarron caused extensive damage to the Cadillac brand, which saw its market share cut nearly in half from the launch of the model line to a decade after its withdrawal.

Eagle (Chrysler)Edit

 
1992 Eagle Premier (Renault 25/Dodge Monaco)
 
1995 Eagle Vision (Chrysler Concorde/Dodge Intrepid)

In 1987, Chrysler Corporation acquired American Motors Corporation (AMC) from Renault, leading to the latter manufacturer ending sales of automobiles in North America. As part of the sale, Chrysler obtained the AMC dealership network as well the name from the AMC Eagle line of all-wheel drive models. A new Jeep-Eagle Division was established for the 1989 model as a strategy to focus on Jeep and specialty models as well as to differentiate the brand from Chrysler's K-car based models.[33] Following the discontinuation of the AMC Eagle Wagon in 1988, the Eagle brand was introduced with Renault-designed vehicles that were developed by AMC prior to the automaker being bought out by Chrysler (the Medallion and Premier).[34] To maintain a product line distinct from Chrysler, Eagle also adopted vehicles produced by Mitsubishi (associated with Chrysler at the time), introducing a line of Summit family models and Talon sports compact cars in an effort to attract consumers shopping imported brands.[35]

For 1992, the Eagle Vision became the first Eagle-brand vehicle developed by Chrysler, replacing the Renault-developed Premier. Slotted between the Dodge Intrepid and Chrysler Concorde, the Eagle Vision shared most exterior trim with the latter and was the only Chrysler LH car offered exclusively with a 5-passenger interior.

Coinciding with the 1998 Daimler-Chrysler merger, the Eagle brand was discontinued; the singular Jeep brand was integrated as part of Chrysler or Dodge dealership networks. The Chrysler 300M was originally developed as a second generation of the Eagle Vision; following the discontinuation of the brand, the vehicle was introduced for 1999 with a slightly restyled grille and Chrysler interior and exterior badging.

Lexus ES250 and Infiniti M30Edit

 
Lexus ES250 (Toyota Camry Prominent/Toyota Vista)
 
Infiniti M30 (Nissan Leopard)

For the 1989 model year, Toyota and Nissan introduced the Lexus and Infiniti luxury brands in the United States (following the Acura luxury brand of Honda) with the Lexus LS400 and Infiniti Q45 full-size sedans. To expand beyond a single-vehicle model line, for the 1990 model year, both brands rebranded existing models from the Japanese market produced by their parent companies to introduce an entry-level vehicle.

The Lexus ES250 is a four-door pillared hardtop sedan, as Toyota redeveloped the Toyota Vista (also called the Toyota Camry Prominent). While bearing a strong visual resemblance to the American-market Toyota Camry (except for the roofline), the ES250 was given a model-unique grille, lower body trim, and wheels; the interior adopted many features from its LS400 counterpart.

The Infiniti M30 is a two-door notchback coupe, as Nissan rebranded its existing Nissan Leopard for sale in the United States; a two-door convertible was also sold (following its conversion in the United States). With the exception of its badging and dashboard (sourced from the left-hand drive Nissan Skyline), the M30 differed from the Leopard primarily in its steering wheel placement.

Intended largely as placeholder models, the ES250 and M30 were largely overshadowed by their companion flagship sedans; both vehicles were withdrawn before the end of the 1992 model year (as their Japanese counterparts had ended their model cycles). Lexus replaced the ES250 with the ES300; while again sharing a body with a Japanese-market Toyota (the Toyota Vista/Windom), the ES300 bore no direct visual resemblance to the American-market Camry with which it shared its chassis and engine. Infiniti replaced the M30 coupe with the J30 four-door sedan, rebranded as the Nissan Leopard J Ferie in Japan.

Rover CityRoverEdit

 
2004 Rover CityRover (Tata Indica)

The Rover CityRover, launched in 2003 as the last vehicle from the MG Rover Group, was a rebadged Tata Indica made in India. English motoring journalist George Fowler criticized the MG Rover Group, who was enjoying national sympathy from the British public as the last domestically-owned automobile manufacturer, stating the CityRover was "a duplicitous attempt to 'save Rover' by flogging an Indian car on which the only Rover bits were the badges."[36]

Models produced under licenseEdit

A variant on rebadging is licensing models to be produced by other companies, typically in another country. The earliest such vehicle was the Austin 7 (1922 - 1939), designed and built by Austin Motor Company and licensed to other manufacturers across continents that became their first-ever model. The Bantam in the US that would eventually build the first Jeep, BMW in Germany, and Nissan in Japan.

Among the post-war cars, the Fiat 124 designed and built by Fiat, Italy was licensed to various other manufacturers from different countries and became a dominant car in many Eastern Europe and West Asian countries.

Fiat 124, Italy and various countries
SEAT 124, Spain
Premier 118NE, India
VAZ-2101 / Lada, Russia and Eastern Europe
Tofaş Murat 124, Turkey

The Morris Oxford Series IV built by Morris of England in 1955 would become Hindustan Ambassador in India and was manufactured until 2014. Another example of this is the British Hillman Hunter, which was license-built in Iran as the Paykan, as well as Naza, building vehicles under license from Kia and Peugeot (Naza 206 Bestari).

A similar example of licensed badge-engineered products would be the Volga Siber, a rebadged version of the Chrysler Sebring sedan and the Dodge Stratus sedan produced in Russia from 2008-2010.

See alsoEdit

ReferencesEdit

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