Car Industry Chronicles

Design is Embracing Globalization, but There’s Still a Long Way to Go

Regional projects have been receiving more opportunities than ever to become global, but not without going through changes

Design is the core department of any automaker — or it should be, at least. Dynamics, electronics, powertrain, everything else could be created with a partner or even simply bought from it, but the visual appearance will always be unique because it is a part of its identity. As a result, it is easy to understand that the automaker is usually protective of its design and, more specifically, of who creates it and updates it.

Globalization has encouraged automakers to work in as many regions as they can. However, as strong as their image might be from the beginning, they still have to worry about what the local clientele wants. In general, they can invest in connecting with it through installing factories, creating regional variations of some models and, if things go well, developing whole other ones there. But there are some issues in that.

Different needs, different products

The biggest reason why makers outsource design to their new branches in the first place is catering to their specific demands. Besides aesthetic preferences, countries around the world keep differences regarding legislation, emissions, taxes, purchasing power and exchange rates to name a few. As a consequence, the ideal car will be very different from one to the other and automakers must respect that as much as possible.

While most of those cars are designed to stay in their regions, some eventually become competitive enough to travel abroad. That is a particularly interesting event because it implies that a branch has worked well enough to impress the headquarters. Brazil and China are the countries where that happens the most frequently, but India and Russia have had cases as well. However, things don’t always happen as they seem.

What exactly happens?

In the 1980s, the Brazilian economy was undergoing a time of instability and Volkswagen’s local branch attempted to deal with it by increasing its exports. A high point of the strategy’s outcome was securing a deal in 1987 to take the Voyage and Parati, both locally created from scratch, to North America for the first time. The thing is, although they had just been facelifted, they had to go through many other changes.

Sealed-beam headlights, front turn signals on the bumper, side marker lights, more ergonomic dashboard, electronic fuel injection and many other changes; the rebadged Fox and Fox Wagon were different enough to deserve magazine articles. However, all that publicity also made Brazilians aware of how inferior were the cars usually accessible to them compared to those offered elsewhere. That is the topic of this Chronicle.

Are there other cases?

This Chronicle’s pictures only show some of them; the latest is the Volkswagen Nivus, a Brazilian crossover that will go to Europe with more modern engines, sportier design and renamed Taigo. As globalization progresses, examples like that become more painful to accept because they all raise the same questions: why do those differences persist? What could companies do to eliminate them without affecting their profit?

Cost is the toughest enemy in situations like that. Offering cars with the same level of technology around the world implies upgrading factories and training professionals and that, in turn, requires an investment whose return is almost impossible to obtain in a reasonable time without increasing the selling prices of the new car. The other option would be to spend years selling too few units, which is not interesting either.

How to deal with that?

Going ahead with investments like that because they have potential to benefit the automaker for a long time. A new platform, for instance, is usually applied to a whole family of cars; new engines may be available for over a decade, and so on. As if that was not enough, producing the same car or, at least, the same parts in multiple countries helps the company make the most of the combined capacity of all its factories.

Regarding customers, the simple fact of employing cutting-edge technology is already a great argument to boost sales; the situation will become even better if the automaker can offer reasonable prices. Besides, having the same models (as much as possible) locally available as those offered in the rest of the world yields favorable reviews from the specialized press and strengthens its image with the local customers.

Developing regional cars is a great way to cater to specific customers. Taking them to new regions, on the other hand, can cause positive or negative effects on the automaker’s image depending on the standards the cars comply with in each region. Do you know other cars with similar history? What do you think, should automakers invest in establishing the same levels of quality around the world? Share your opinions!

Writer and future engineer striving to work with car design. If you like cars but not the stereotypes that surround them, give my articles a try.