29th November, 2017 · International

Dealer satisfaction down in UK

6 minutes to read

In this article

Current profit return

With 11 responses out of 29 better than neutral (5.0), the average response decreased by 0.6 points from 5.4 to 4.8 points compared to the previous survey.

Future profit return

Dealers showed more satisfaction with their predicted future profit than their current one with 15 out of 29 responses above the neutral score of 5.0.

Total margin

With regard to satisfaction with total margin on new vehicles, 20 Dealer networks saw their score decline, eight saw an increase and one remained unchanged.

Return on investment – return on capital

A concerning 72% of the Dealer network (21), experienced a decrease in satisfaction regarding their return on capital.

Satisfaction with volume target aspirations

Of the Dealer networks surveyed, 20 saw their score decrease, whilst eight improved and one was unchanged.

New car targeting process

In response to how satisfied Dealers were with their new car targeting process, the average score given was 4.7, which is a 0.2 reduction from the last survey.

Inducement to self-register vehicles

The average score of 4.8 is lower than the last survey by 0.4 points. Slightly less than half of the Dealer networks (14 out of 29) gave a response above the neutral score of 5.0 regarding their satisfaction with inducement to self-register vehicles.

Incentives – current bonus and rebate rates on new car sales

The average Dealers’ satisfaction with bonus and rebate rates for new car sales decreased by 0.5 from the last survey.

Day-to-day working relationship – ability to do business with your manufacturer

The ability to do business with manufacturers on a day-to-day basis is crucial for franchised Dealers and, positively, 23 out of 29 of the Dealer networks surveyed had satisfaction levels above the neutral score of 5.0.

Day-to-day working relationship – does management of your manufacturer actually take Dealers’ views and opinions into account?

The majority of the Dealer networks surveyed (17, 59%) had levels of satisfaction above the neutral score of 5.0.

Standards

The average Dealer satisfaction with the fairness and reasonableness of their manufacturer’s Dealer standards decreased from 6.3 to 6.0.

Performance measures

The average score decreased by 0.3, from 6.2 to 5.9. Despite the average score being above the neutral point of 5.0, 19 Dealer networks saw a decline, only nine saw their score improve and one did not change.

Overall ranking

The most significant measure of the health of the Dealer/manufacturer relationship is the overall ranking question.

Average score

Another measure to see how satisfied the Dealer networks are with their manufacturers, across all the elements of the survey, is to use the average score given to all questions.

British franchised new car Dealers are less satisfied with their relationships with manufacturers than they were six months ago.
The National Franchised Dealers Association (NFDA), which represents franchised car and commercial vehicle Dealers in the UK, conducted its Summer 2017 Dealer Attitude Survey, which found an average satisfaction score of 5.6 out of 10 amongst Dealers regarding their overall relationship with manufacturers.

That is -0.5 points down from the last survey and -0.6 lower than the same time last year.

NFDA Director, Sue Robinson, said the Summer 2017 survey had 1,754 respondents from a total of 29 participating franchised networks, which equates to a response rate of 42%.

“The Summer 2017 survey had an encouraging response rate, with considerably increased response return from smaller dealerships, highlighting the importance of the survey for both Dealers and manufacturers, enabling them to monitor and evaluate the health of their relationship,” Ms Robinson said.

“The results of the survey show that external factors might have put a strain on the Dealer-manufacturer relationship. However, despite the substantial decline in the average score of the manufacturer rating question, more than 60 per cent of the Dealer networks surveyed returned a score above the neutral point of 5.0.”

As with previous surveys, respondents were asked a series of questions covering a range of business aspects and their impact on the relationship with manufacturers. Responses are scored from 1 (extremely dissatisfied) to 10 (extremely satisfied).

Key results:

Kia became the highest scoring franchise with 9.2 points. Kia surpassed Mercedes, which now follows with 9.0 points. Lexus remained the third placed network with 8.4 points.

Kia also had the highest average score (8.5) across all questions of the survey.

Suzuki and Toyota closed out the top five with 8.0 and 7.8 points respectively. Toyota experienced a significant improvement of 1.1 points on last winter’s score of 6.7.

The least valued networks were Jeep (2.9), Citroen (2.8), and Nissan (2.6).

Audi was the most improved Dealer network, with an increase of 1.5 points. Audi gained a total of 61.8 points across the whole survey, achieving the highest overall improvement.

“Although average scores across the majority of the questions have generally declined, some networks continued to perform well following recent success and others showed significant improvements. Notably, Kia reached the first place in the all-important question and Audi recorded the highest increase in score across all the questions of the survey,” Ms Robinson said.

“In a period of uncertainty, where a coordinated and combined approach is needed to deal with a number of important issues currently facing the industry, it is vital that manufacturers and Dealers continue to work together to safeguard the interests of the automotive sector.”

Other results:

Current profit return

With 11 responses out of 29 better than neutral (5.0), the average response decreased by 0.6 points from 5.4 to 4.8 points compared to the previous survey. Only six Dealers saw their level of satisfaction increase, while 22 saw a decrease and one remained the same.

Top performer:    Mercedes     8.6 points
Bottom performer:    Alfa Romeo     2.4 points
Most improved:    Audi     +2.2 points
Biggest decline:    BMW     -2.8 points
Average score:        4.8 points

Future profit return

Dealers showed more satisfaction with their predicted future profit than their current one with 15 out of 29 responses above the neutral score of 5.0. The average score was 5.2, 0.4 points lower than the last survey. Of the Dealer networks surveyed, 19 saw their levels of satisfaction decrease, eight saw an increase and two did not change.

Top performer:    Kia    8.5 points
Bottom performer:    Jeep    2.6 points
Most improved:    Audi & Volkswagen    +1.5 points
Biggest decline:    Peugeot    -2.6 points
Average score:        5.2 points

Total margin

With regard to satisfaction with total margin on new vehicles, 20 Dealer networks saw their score decline, eight saw an increase and one remained unchanged. On a positive note, nearly half of the Dealer networks (14) gave a score above the neutral point of 5.0. The average Dealer rating is 5.5, 0.5 lower than the Winter 2017 survey.

Top performer:    Kia    8.4 points
Bottom performer:    Jeep    2.5 points
Most improved:    Audi    +1.6 points
Biggest decline:    BMW    -3.0 points
Average score:        5.0 points

Return on investment – required capital

Of the Dealer networks surveyed, 19 saw a decrease compared with the last survey, nine saw an increase and one remained the same. Slightly less than half of the Dealers, 13 networks, gave a response better than 5.0. The average score across all Dealers was 5.1 which is 0.4 down from the last survey.

Top performer:    Kia    8.6 points
Bottom performer:    Alfa Romeo    1.7 points
Most improved:    Audi    +1.8 points
Biggest decline:    Alfa Romeo    -2.5 points
Average score:        5.1 points

Return on investment – return on capital

A concerning 72% of the Dealer network (21), experienced a decrease in satisfaction regarding their return on capital. Only seven experienced an increase and one did not change. The average Dealer gave a score of 4.7, which is 0.5 down from the last survey and below the neutral score of 5.0 points.

Top performer:    Mercedes    8.7 points
Bottom performer:    Alfa Romeo    1.7 points
Most improved:    Audi    +1.7 points
Biggest decline:    Peugeot    -2.8 points
Average score:        4.7 points

Satisfaction with volume target aspirations

Of the Dealer networks surveyed, 20 saw their score decrease, whilst eight improved and one was unchanged. Nearly half (45%) gave a response better than the neutral score of 5.0. The average score of 4.8 is 0.2 down from the last survey.

Top performer:    Kia    8.2 points
Bottom performer:    Jeep    1.8 points
Most improved:    Audi    +1.4 points
Biggest decline:    Peugeot    -2.0 points
Average score:        4.8 points

New car targeting process

In response to how satisfied Dealers were with their new car targeting process, the average score given was 4.7, which is a 0.2 reduction from the last survey. Of the Dealer networks surveyed, 19 saw a decrease in satisfaction, nine saw an increase and one was unchanged. Nine Dealer networks gave a response above 5.0.

Top performer:    Kia    8.3 points
Bottom performer:    Jeep    1.8 points
Most improved:    Toyota    +1.7 points
Biggest decline:    Peugeot & Subaru    -2.0 points
Average score:        4.7 points

Inducement to self-register vehicles

The average score of 4.8 is lower than the last survey by 0.4 points. Slightly less than half of the Dealer networks (14 out of 29) gave a response above the neutral score of 5.0 regarding their satisfaction with inducement to self-register vehicles. While nine Dealer networks saw their score grow, 20 experienced a decline.

Top performer:    Kia    8.0 points
Bottom performer:    Nissan    1.9 points
Most improved:    Audi & Abarth    +1.9 points
Biggest decline:    Peugeot    -2.2 points
Average score:        4.8 points

Incentives – current bonus and rebate rates on new car sales

The average Dealers’ satisfaction with bonus and rebate rates for new car sales decreased by 0.5 from the last survey. The majority of Dealer networks (21) saw a decrease in their levels of satisfaction; only six reported an increase and two scores remained the same. Less than half of Dealer networks (12, 41%) gave a response above 5.0.

Top performer:    Mercedes    8.3 points
Bottom performer:    Nissan    2.7 points
Most improved:    Audi    +1.1 points
Biggest decline:    Subaru    -2.6 points
Average score:        5.0 points

Day-to-day working relationship – ability to do business with your manufacturer

The ability to do business with manufacturers on a day-to-day basis is crucial for franchised Dealers and, positively, 23 out of 29 of the Dealer networks surveyed had satisfaction levels above the neutral score of 5.0. However, 20 saw a decrease, whilst seven saw their score improve and two remained at the same level. The average score has decreased by 0.3 from 6.5 to 6.2.

Top performer:    Mercedes    9.3 points
Bottom performer:    Nissan    2.9 points
Most improved:    Audi    +1.3 points
Biggest decline:    BMW    -2.0 points
Average score:        6.2 points

Day-to-day working relationship – does management of your manufacturer actually take Dealers’ views and opinions into account?

The majority of the Dealer networks surveyed (17, 59%) had levels of satisfaction above the neutral score of 5.0. However, the average score decreased from 5.9 to 5.5 and, whilst only nine Dealer networks saw their score improve, 20 of them experienced a decline.

Top performer:    Mercedes    9.2 points
Bottom performer:    Nissan    2.3 points
Most improved:    Audi & Volkswagen    +1.1 points
Biggest decline:    Peugeot    -2.2 points
Average score:        5.5 points

Standards

The average Dealer satisfaction with the fairness and reasonableness of their manufacturer’s Dealer standards decreased from 6.3 to 6.0. The majority of the Dealer networks (20), experienced a decrease in satisfaction, seven saw an increase and two remained unchanged. 22 of the 29 Dealer networks had a score which was above the neutral score of 5.0.

Top performer:    Kia    9.0 points
Bottom performer:    Nissan    3.4 points
Most improved:    Audi    +1.4 points
Biggest decline:    Nissan    -2.5 points
Average score:        6.0 points

Performance measures

The average score decreased by 0.3, from 6.2 to 5.9. Despite the average score being above the neutral point of 5.0, 19 Dealer networks saw a decline, only nine saw their score improve and one did not change. Nearly four out of five networks (23, or 79%) returned a score that was above the neutral score of 5.0.

Top performer:    Kia    9.0 points
Bottom performer:    Nissan    3.0 points
Most improved:    Audi    +1.0 points
Biggest decline:    Peugeot    -1.9 points
Average score:        5.9 points

Overall ranking

The most significant measure of the health of the Dealer/manufacturer relationship is the overall ranking question. The Dealer Attitude Survey Summer 2017 average Dealers’ rating of their manufacturer decreased by 0.5 since the last survey, from 6.1 to 5.6. This is primarily due to the fact that 76% of the Dealer networks decreased their rating, whilst only 24% increased it. Positively, 18 Dealer networks, 62% of the total, returned an average score above 5.0.

Top performer:    Kia    9.2 points
Bottom performer:    Nissan    2.6 points
Most improved:    Audi    +1.5 points
Biggest decline:    Subaru    -2.9 points
Average score:        5.6 points

Average score

Another measure to see how satisfied the Dealer networks are with their manufacturers, across all the elements of the survey, is to use the average score given to all questions. Across all questions, the average score given by Dealers was 5.8, 0.4 lower than the average score of the last survey. Nearly three quarters of the Dealer networks experienced a decline, whilst eight saw an improvement. Positively, 23 out of 29 returned an average score above the neutral score of 5.0.

Top performer:    Kia    8.5 points
Bottom performer:    Jeep    3.5 points
Most improved:    Audi    +1.1 points
Biggest decline:    Peugeot    -1.9 points
Average score:        5.8 points