John Crennan – Back in the Driver’s Seat

John Crennan is an Australian auto industry legend who left ‘the love of his life General Motors’ after a long and distinguished career to launch and successfully run Holden Special Vehicles (HSV) and the Holden Racing Team (HRT) with UK entrepreneur and racing car driver Tom Walkinshaw.

After ‘retiring’ from the business he’s back in the driver’s seat as CEO of Nissan Motorsport where I caught up with him recently.

Firstly, how is the book going?
I’ve sort of hit a wall. The book lost a little bit of its relevance and I’ll have to tweak it because so much of it was centred on the decline of Holden’s performance and market share and the reasons for that. I predicted that these factors would lead to Holden ceasing manufacturing in Australia and since that’s now happened there’s got to be some
changes made.

So who or what influenced you to choose a career in the auto industry?
Well my dad was at General Motors. He was there for 43 years and we overlapped, I think, about eight of those years. More interestingly, my uncle was George Mansfield. He was a legendary Ford figure in the retail side. He ran Melford Motors and then at the age of 60 founded New Oakleigh Motors and they virtually carried Uncle George out of the place at about 84. My father was rather quiet and reserved, but I have to say that the influence of my dad in taking me to all the Christmas parties and getting me jobs in the maintenance and office areas in my teens was a major inspiration.

What impact will the loss of Australian automotive manufacturing have on dealers and their customers?
I don’t think the car market is going to suffer. It will be around 1.1 million a year over the next five years. One can only hope that the flow of product that replaces the local product is so interesting that it stimulates the market and maintains the Dealer side of it. The bruising that comes with your brand going out of local production must impact on the Dealers – especially those Dealers who’ve had a dependency upon local manufacture, Toyota, Holden, Ford. I’m a bit disappointed in the way the car companies handled their exits. To me, Ford did a very good job. There was a certain sense of poise and finesse about their activity and it caught everybody by surprise. There wasn’t speculation for two months before, they just got on with it and as difficult as it is to do these sorts of things, I thought they handled it with a great sense of dignity. On the other hand the love of my life General Motors, I think ballsed it up. I think they gambled with the government and played a game of poker publically and then when we finally got the decision there was this knee jerk reaction, with an advertising campaign that looked hurried and a bit condescending. It’s interesting to see the contrasts in the way the companies handled this tough situation.

You’ve been quoted as saying that there is too much product or too many brands in Australia for the size of the market. Do you still have that view?
Oh yeah, an old boss of mine said, ‘I’ve never seen any car market in the world where so much is provided by so many to so few.’ It really has been an experimental market. It’s a low cost experimental market for many brands and the mere fact that we’ve got the best part of over 60 different car and truck brands represented here for a market of 1.2 million – while America’s got 35, would tell you that something’s got to give. I don’t understand the logic of companies being prepared to have a crack at getting 0.5% or 1% of the market. I just don’t see the viability in all of that. However, it’s a great way for some of these companies without taking too much financial risk to see whether product A, B or C is going to make it in bigger markets by testing it here first.

Would you put Opel in that category?
Yes, they came and dipped their toe in the water and got out pretty fast.

What’s your opinion of Holden’s current marketing and advertising?  Do you think it’s effective?  
My opinion is not just of Holden, but everybody – you don’t see any brand advertising any more. You’re not seeing anything that’s building the corporate brands; it’s creating an appetite for feeling good about the brand. It’s all hardnosed retail. On a Friday I’d pick up the paper and I just see slash and burn and whack and crash and that’s no doubt the way the market is, but it seems a shame. In our days with George Patterson Advertising there was probably 25% influence on hardnosed retail because you left that to the Dealers, and the other was building customer sentiment towards your brand and selling the product features and getting the story over about the product. The product was almighty, now it’s the price that’s almighty. Whatever way you cut it, particularly when it’s going to be an import business, it will be a battle of the marketers. It’s going to be who’s the superior marketer in all of this and who’s got the brand that’s got the best cache and I would certainly like to see a far greater percentage of company advertising budgets directed towards brand.

In your time at Holden, who was the most effective CEO?
I would have to say Charles Chapman. He was an engineer. He was methodical. He was a great leader. He was balanced. He was poised and first and foremost he built his internal team with an enormous sense of quality and an enormous sense of balance. Perhaps for the Dealers he may not have been aggressive enough, but he was, to my mind, a
wonderful thinker.

Just changing the subject, how many podium finishes would you like to have this year?
I would like to think we would have half a dozen. We had 28 top 10s last year. I would be very disappointed if we didn’t have 50 top 10s and I’d be pleased with six podiums.

Are you looking forward to the Grand Prix?
Yeah it’s a good thing overall. Again I’m concerned and don’t like the fact that the taxpayer has to pay as much to make it work. I feel the Grand Prix let us down a little bit in not selling harder to the ‘corporates’ and getting greater corporate support to at least get a break even situation. I think it’s gone on for too long with government support, but it is a great gift that Melbourne has and we’re pretty lucky, I’d hate to see it lost.

I also read that you were invited to do some consulting with GM in the States.
Oh yes that was three years ago. Mark Reuss was very impressed with the HSV/HRT model, the way in which the motor sport program drove the high-end performance market and some of the niche marketing programs we did to provide some extra delight to the enthusiast market. He liked that whole business model and asked me if I could present it to both Rick Hendricks and Dale Earnhardt. So I did that and also with Roger Penske in Detroit, I made a presentation there about that model and how it worked because they had visions at that time of the Commodore product being exported to America and would have liked to have replicated some of that activity. I think that’s fallen by the way because the export program did not get the traction that they thought it would have.

You drove an HSV for many years, what are you driving now?
I’ve got the latest Nissan Pathfinder, which I love. It’s a great car.

What would be your reaction if the government gave the go-ahead to import second hand vehicles from Japan and Singapore?  
I only heard that last week. Mark Skaife called me on it because he attended part of the productivity commission and I’m flabbergasted. I’ve seen firsthand the New Zealand side of it and what a mess it made of so many things. I fail to see one aspect of it that’s good for the business. I just can’t work it out.

And your opinion on the abolition of the luxury tax?
Yeah I think that’s a good thing. I think if we’re going to get out of local manufacture, to me it was somewhat of a protectionist program. So if there’s no need to protect the local industry, I would see some value in that being abolished.

What does John Crennan do to relax?
Work. I can’t watch a movie, I can’t read a book.

Motor racing, AFL, NRL, cricket, soccer – what’s your passion?
Outside of motor sport, I love my football, a bit of golf too. I was born and bred as an Essendon boy, but then I got recruited to North Melbourne at one stage in my career when I was 19.

Finally, if they were going to make a movie about John Crennan, who would you like to portray you?
John Wayne.


Author: Charles Bayer

1 comment

Leave a Reply

Your email address will not be published. Required fields are marked *