Chinese manufacturer Chery has taken a dual-brand approach to entering the UK car market. The Omoda brand’s 5 SUV made its debut in the middle of 2024, while deliveries of the Jaecoo 7 SUV begin here this month.

Speaking to Business Car while preparing for the Jaecoo 7’s launch, Omoda and Jaecoo head of fleet Chris Clayton tells us that fleet customers were the priority focus during a “semi-soft launch” stage.

When asked for the reasoning behind this strategy, he explains: “The business customers that I’m speaking to seem to be buying sooner than your retail customer. They are looking now maybe six months in advance. 

“With the leasing companies, they need to see, touch, feel the vehicle before they will set residual values, so we’re taking it round for them to look at it, and we want to get those corporate customers seeing, touching the vehicle as well, so they can hopefully pre-order a car so we’ve got a nice healthy order bank for our launch.”

The Jaecoo 7 arrives in the UK several months after the Omoda 5 made its debut. When asked how this model has been received by fleets, Clayton says: “It’s tricky, because we’ve got petrol or EV. EV is such a crowded market from all the traditional manufacturers. We’re not the cheapest, and we are a brand no one’s ever heard of before in a lot of cases. 

“But we’re doing well, we’ve got some really good corporate end users in our vehicles now, we’re working closely with all the big leasing companies, all the big salary sacrifice providers, like Tusker and Octopus where the car’s doing really well. 

“The EV is doing really well in those sections. The petrol is not really a salary sacrifice or company car – that’s working well in a lot of the other channels, whether it’s PCH or rental, bodyshop.”

Unlike the Omoda 5 – the electric version is badged E5 – the Jaecoo 7 is not available with a pure EV powertrain – a surprise given the model’s early fleet push and the importance of EVs in the company car market. Instead, it is petrol or plug-in hybrid.

When asked why the first UK Jaecoo isn’t available as an EV, whereas the first Omoda is, Clayton says: “They are different brands with different characteristics. The Jaecoo feels more premium – it feels like we’re pushing that against a more premium basket of competitors. Although it has some luxury elements in it, with its price point of £30-£35k mark you can’t really call it luxury. 

“Whereas the Omoda has elements of premium within it, but it’s probably considered more of a volume brand. 

“They both have a place in that fleet market, it’s just trying to get that brand awareness out there so that everyone knows about them, and that’s
our biggest challenge when we ramp up the volume of registrations.”

Standing out

The UK car market has seen several Chinese brands entering over the past couple of years. When asked how Omoda and Jaecoo can differentiate themselves from the others, Clayton names factors including quality, range, spec, and price – but adds it’s not just Chinese competitors they need to stand out against.

He says: “Do I worry about getting lost? We are already lost between the traditional manufacturers at the moment. I don’t think there’s ever been a time in the UK where there’s been as many manufacturers. 

“But no, I’m not necessarily worried about it. We’ve got really good dealer franchise groups that are helping us, we’ve got a very strong proposition, and we’ve got some models that are head-turning. 

“A lot of the Chinese entrants have helped us a massive amount, but some recent entrants, the quality hasn’t been there. We’ve suffered as a result of that when we try to partner with different leasing companies – they put processes in place because maybe they let new entrants on without being as thorough as they needed to. 

“But I think brands like ourselves and BYD are very much in line for leading compared with both the other new entrants and the traditional manufacturers in the UK.” 

Noting the competitiveness of the EV market in particular, Clayton adds “We need that brand awareness to grow so people can see the value in each of our different models, because I don’t want to be going and doing some of these distress deals that you can see in the market at the moment, because people are going to put our brand as ‘cheap’, which we are not.”

One criticism some Chinese entrants have faced is related to problems with SMR, and Clayton says this is an area where Omoda and Jaecoo have been able to learn from others’ mistakes. He says: “We’ve seen new entrants come in with really high insurance costs, we’ve seen people struggling with parts availability, repair methods and stuff like that, which is ultimately just going to reduce the number of sales and the number of partners and [affect the] relationships that you’ve got with those partners. 

“We have implemented the RAC as our breakdown provider. We have partnered with [automotive risk organisation] Thatcham, so we have Thatcham staff regularly visiting our factories in China to work with us to ensure that our repair methods, how we’re manufacturing these vehicles, is going to be well-received by insurance companies and other businesses like that. 

“We’ve partnered with DHL as our key logistics provider in the UK. They have a parts logistics hub near Peterborough, and they offer overnight parts delivery for any part of our vehicle. 

“I think that shows we are using that hindsight well to attack those areas that other people have maybe stumbled over, to improve our offering overall.”

Dealer focus

As Omoda and Jaecoo look to build up fleet business, Clayton says a dealer network which should number 80 by the end of Q1 will have an important role to play, with around a third of the dealers handling fleet business at the time of our interview.

He says: “It’s the same old song that all manufacturers have said, getting those dealers to deal not only with the national business but also to source local business from their area, from SME and other areas. 

“Dealers are vital. I joined this business because of our dealer franchise network. Fortunately for me, I’ve worked with a lot of our current dealer partners, so I know the job they can do. 

“We need to help motivate and support those smaller dealers and maybe medium-sized dealers that maybe don’t have a local business development manager, don’t have that infrastructure to drive fleet business.

“We don’t do direct sales. Every car that we do goes through a dealer, whether it’s for rental, a broker, leasing, corporate, and those numbers are growing both in terms of the number of dealers transacting and also the volume.”

As well as helping dealers to sell cars to fleets, Clayton says another important task will be getting them up to speed with EVs. He says: “We’re about to launch our EV charging programme with a couple of partners in the UK, which is just giving dealers tools to try and hit that ZEV mandate overall for us. “A lot of these dealers are multi-franchise, multi-marque dealer groups. We have the ability for them to use their existing customer bases and transition them into our product, so everything we are trying to do is funnel those customers into an EV.”

Omoda and Jaecoo spent most of last year with a four-strong fleet team, but this is set to scale up this year to meet expected demand.

The year will be a busy one for the brands, marking their first full year of UK sales, and also seeing the introduction of more models, including the Omoda 9 and 7, and the Jaecoo 5.

Clayton says: “We’re ramping up massively. From a fleet perspective, fleet marketing, we need to grow brand awareness – we are growing our demonstrator fleet so we can help get bums on seats to try the car. I think that and rolling out corporate strategy is going to really help us as we move into Q1 and Q2.”