Interview – David Peel, managing director, Peugeot UK

Why Peugeot is riding the crest of a wave in the UK

David Peel was appointed managing director of Peugeot UK in March 2016, having cut his teeth in retail. After university, he started out as a car salesman and climbed through the ranks to run the Robins & Day group, prior to becoming head of retail for all PSA Group brands in the UK.

On the face of it, his timing was impeccable, with Peugeot’s product line-up undergoing a dramatic transformation from shortly before he started right up to the present day, bolstering customer appeal and residual values. At this year’s What Car? Awards, the firm’s new 208 beat opposition such as the Audi A1 to be our choice in the top price point in the small car category, while the Peugeot 5008 scooped the Large SUV of the Year award.

Were you destined for the car industry?

“Yes, it was inevitable. Cars were my passion. I went to university to study design with a view to being a car designer, but there weren’t many jobs available in design. In my late teens and early 20s, I even built and ran a rally car. When I was looking for work, my parents told me to apply for everything, just to get the interview practice. So I did, and one of the first I did was in a Ford dealership as a trainee salesman. I got home from that and my mum told me they’d made an offer and she’d accepted on my behalf. I started on £5 a day, plus commission.”

What did those early years teach you?

“I never thought I was the best or the smartest, but all I ever did was treat people properly. And I discovered that if I treated customers as I would someone in my family, anything was possible. That still guides me.

“I was working for Evans Halshaw, and I just worked my way up. This was the late ’80s and the opportunities kept coming. My philosophy wasn’t to sell, but to listen to what a customer wanted. It drove some of my colleagues mad, because I’d make the customer a coffee, chat to them, go slowly… and without realising it, I became the most successful salesman.

“Today, a lot of people come to me and say, ‘If you just give me the opportunity, I’ll prove what I can do’. But I always have to turn around and say, ‘But you’ve had the opportunity to show me what you can do’. That’s how my career went. I didn’t wait for chances; I tried to prove I deserved them.”

‘Sometimes I can be the poacher turned gamekeeper; I know a few of the tricks to selling cars’

Does it help in your relationship with retailers that you’ve been there and done it from their side of the fence?

“I believe so, and in both directions. I have empathy for what they’re trying to achieve and what’s important to them, but also sometimes I can be the poacher turned gamekeeper; I know a few of the tricks.

“Above all, the network know I’ve been there and know what the coal face looks like. They can turn to me, confident they’ll get an understanding hearing.”

You’ve enjoyed being part of the transformation of Peugeot, haven’t you?

“What I recognise in myself is that I enjoy competition. It’s not my personal success that’s important to me, but that all the hard work gets rewarded. I want to win, and I want to win without shortcuts.

“Sometimes I reflect on what we achieved at Robins & Day, taking it from unprofitable, unkempt sites to amazing examples of the very best; it’s thriving today because of the robust core values we created. That idea of building something with proper foundations sums it up.”

That takes time, though…

“I didn’t take this job for two years; I took it for the long term, and that does change how you approach it. I didn’t feel pressure to make a name for myself, or make snap decisions to grab market share, because I didn’t feel the pressure to make short-term moves. Look at the positive shift in our residual values and you’ll understand the longer-term plan we have.

“Loosely, I planned around two three-year cycles, although that doesn’t mean I have plans to go anywhere – just that I could envisage genuine success in that timeframe. I’m in my fifth year now, and while there are no guarantees, I can see the foundations being laid for ongoing success.”

What has driven that success?

“Part of it is due to our openness to change, and part of it is down to our products. I do think our engagement with the network has reaped dividends; our programmes and policies are very well crafted. And we have 12 new products in 2020, giving us terrific momentum.

“I can’t claim any credit for the product – although I do give feedback at the right time – but I can influence having everything in place to sell the cars when they come.

“Some of the influences might be subtle – for instance, I’ve insisted that every car we’ve used in our advertising for the past four years is right-hand drive – and some are more overt. The way we incentivise retail staff is quite innovative, for example, and that has boosted retention significantly.”

‘We were struggling to keep up in the area of electrified technology, but now we’re leading the way’

It sounds like you have a robust relationship with the company’s leaders in Paris?

“We have set the foundations really robustly to complement the product, and they recognise that. I’m in the fortunate situation of knowing [Peugeot CEO] Jean-Philippe Imperato well, because he was my boss when I ran Robins & Day. We worked together for years. It’s not a love-in by any means – we challenge each other, or maybe he challenges me a bit more than I challenge him – but the relationship is strong.

“Then there is Maxime Picat, who is in charge of Europe, and Carlos Tavares, who runs the company. I don’t see them as often, but it is a credit to them that I’m entirely comfortable in their presence. The ethos of this company is that if we say we’re going to do it, then we do, so I enjoy the review sessions with them, because they leave no stone unturned, set a course – and then we deliver on it.”

You’ve made strong gains in the NFDA dealer survey in recent years…

“We had tough years – we came last in 2016, I think – and now we’re eighth. Remember, though, this is a company that had to get lean to survive; that translates to a fighting spirit, and that’s true at every level.

“In terms of the dealers, I always felt we could progress because the relationship, however hard, has always been 100% collaborative. I encourage feedback and criticism and I don’t play politics, and they know that. If you can look each other in the eye, it’s so much easier to set achievable goals and make progress.

“It hasn’t always been about delivering good news. It’s true that we’ve cut dealers, but we were fair; we set targets and deadlines. If they missed them, they had chosen to go.”

They’re happier now, but presumably profits help that?

“In 2016, we set our number one priority at a 1.5% return on sales. I think it was down to 0.4% at the time. Today we have 75% of our network at 1.4%. We’d expected to get everyone to 1.5% this year, but we now have to see how that looks.

“There’s also a lot of support beyond profits. Our training programmes are first class, our loyalty bonuses effective, our brand identity distinctive and our message around ‘Unboring the Future’ very clear. We’re also leading the way on electrified technology, starting with the e-208 but followed by a huge number of hybrid and electric products. Where we were struggling to keep up, we have taken leadership.”

 

To run bespoke brand reports using whatcar.com market data, please contact insights@haymarket.com