After-Sale Service Satisfaction Rises in Indonesia; Ford Ranks Highest in CSI

Road in Jakarta, IndonesiaOverall customer satisfaction with the after-sale service experience in Indonesia improves by 15 points from 2012, to an average of 755 (based on a 1,000-point scale), according to the 2013 Indonesia Customer Service Index (CSI) Study. The largest advances come in two of five factors* evaluated—satisfaction with service initiation and service advisor.

The improvement in after-sale service satisfaction is noteworthy as there has been sales growth in the country during the past few years, which makes it critical to continue to manage customer expectations. Light-vehicle deliveries in 2013 are expected to increase by about 10% (to 1.1 million units) from 2012, based on a forecast from strategic partner LMC Automotive. Continue reading ›

Lack of Routine Service Visits Impacts Vehicle Dependability in India

MArora

Mohit Arora

The overall dependability of vehicles (2.5 to 3.5 years old) in India has declined for a second consecutive year, and problems measured across all categories have increased 24% from the previous year, according to our 2013 India Vehicle Dependability Study (VDS).

In a July post on our Global Automotive Blog (GAB), Mohit Arora, executive director of J.D. Power Asia Pacific, pointed out that “an overall decline in vehicle dependability in India may be partly due to the fact that an increased number of vehicles in the country are not covered under extended warranties or service contracts.” He also said owners are not taking in their vehicles for maintenance as often as in the past. Continue reading ›

Exceptional Service Advisors May Lead to Higher Satisfaction with Dealer Service in the Philippines

manila-trafficNew-vehicle owners in the Philippines this year put more importance on personal interaction and having exceptional service advisors as a first point of contact at the dealership, according to our 2013 Philippines Customer Service Index (CSI) Study.

The study, which measures overall customer service satisfaction among more than 1,800 vehicle owners who visited an authorized service center for maintenance or repair work during the first 12 to 24 months of ownership, finds that overall satisfaction with service at authorized dealerships improves by an average of 4 points in 2013 to 832 (on a 1,000-point scale) vs. last year. Continue reading ›

Owner Expectations in China Hamper After-Sales Service Satisfaction

Mei Songlin

Dr. Mei Songlin

Overall customer satisfaction with after-sales service at authorized dealerships in China declines to 815 (on a 1,000-point scale) in 2013 from 832 in 2012, due to higher customer expectations related to the service experience, according to our 2013 China Customer Service Index (CSI) Study. Among all brands by origin, only the Korean brands improve their customer satisfaction scores in 2013.

The study examines satisfaction among 15,370 new-vehicle owners (between 12 and 24 months of ownership) who visited an authorized dealer’s service department for maintenance or repair work during the past 6 months. Typically, this period is during the vehicle warranty period. A few study highlights are summarized:

• The decline in customer satisfaction with after-sales service in China is driven mainly by a drop in satisfaction with China’s domestic brands (751), as well as with Japanese (831) and European brands (832). The foreign brands’ combined scores decline 29 and 17 points, respectively, vs. 2012. Continue reading ›

J.D. Power’s President Discusses Good News for China’s Auto Industry; Presents Awards

 

Executives from 14 of China’s automakers attended a J.D. Power Asia Pacific presentation and awards ceremony in Shanghai. Finbarr O’Neill, president of J.D.Power and Associates (center) spoke at the event.

During the past decade, the auto industry in China has achieved exponential sales growth and also has made significant strides in improving . . . Continue Reading J.D. Power’s President Discusses Good News for China’s Auto Industry; Presents Awards

Dealerships Rely on Service Business; Single-Point Stores Still Viable

NY Auto Forum Dealer Paneli-CQFWkSW-SThree auto retailer owner/operators discussed opportunities and challenges that lie ahead for dealerships today and in the near future, during a one-day New York Automotive Forum jointly sponsored by J.D. Power and Associates and the National Automobile Dealers Association (NADA) that was held before the New York International Auto Show (March 29 – April 7). The following post features dealer views on service business and the outlook for single-point dealerships.

Moderator: Glenn Mercer, Independent Consultant

Panelists:

Earl Hesterberg, President and Chief Executive Officer, Group 1 Automotive, Houston, TX; the fourth-largest public dealership group in the U.S., U.K. and Brazil (142 dealerships)

Jon Lancaster, Retired Toyota/Lexus Dealer, Madison, WI

Wesley (Wes) L. Lutz, Owner, Extreme Chrysler/Dodge/Jeep, Inc., Jackson, MI

What About the Aging Fleet and Service Work?

Glenn: Moving to the “bricks” side of things—service. As was mentioned in an earlier presentation, the average age of the fleet in the U.S. is something like 11 years. The older model—sweet spot for a dealer was 1-5 years old and the independent aftermarket kicks in at 4-9. Now you’ve got a whole slog of cars that are way out there. Are those lost forever—the 17-year-old car? Or at some point do you think you could claw back this increasingly elderly fleet?

Wes: The whole business model has changed. Ten to 15 years ago we were doing 80% warranty and 20% customer pay. It is now 20% warranty and 80% customer pay. So we are learning as an industry how to approach those customers. For years and years, we didn’t have to worry about those customers. We’d come out with a recall and it was wonderful because our shops were busy all day long. We’re getting better at it and we’re getting more competitive because you have to be competitive today with the price transparency on the Internet. Continue reading ›

What Will the Auto Retailer Look Like in the Future—by 2020 to 2025?

Three auto retailer owner/operators discussed opportunities and challenges that lie ahead for dealerships today and in the near future, during a one-day New York Automotive Forum jointly sponsored by J.D. Power and Associates and the National Automobile Dealers Association (NADA) that was held at the Grand Hyatt Hotel before the New York International Auto Show (March 29 – April 7).

NY Auto Forum Audiencei-hnNQR2z-SAll dealer panel members pointed out that new-vehicle margin compression is a major concern. In addition, they said that regulation on the F&I side is a near-term concern as is the possibility of increases in interest rates. The panel members told moderator Glenn Mercer, a dealership consultant, that retailers already are challenged now in working with customers so they understand the sophisticated electronics in new vehicles. All agreed that retailing is changing—and that the Internet will be integral but that a physical dealership presence still will be required even in the future. Excerpts from the dealer panel discussion are highlighted in several posts during the next week.

Moderator: Glenn Mercer, Independent Consultant

Earl Hesterberg, President and Chief Executive Officer, Group 1 Automotive, Houston, TX; the fourth-largest public dealership group in the U.S., U.K. and Brazil (142 dealerships)

Jon Lancaster, Retired Toyota/Lexus Dealer, Madison, WI

Wesley (Wes) L. Lutz, Owner, Extreme Chrysler/Dodge/Jeep, Inc., Jackson, MI

Bricks and Clicks—How about Buying a Car on the Internet?

Glenn: We can start off with something that has been a theme throughout the day: “Clicks and Bricks.” At some point in time, is there a “Buy” button on the website?

Jon: I think a differentiator from other industries is: in many cases there is a trade-in. And that trade-in is certainly going to make it a lot more difficult to click the button and have the car show up because they have something they’ve got to get rid of on their doorstep. The technology is there. There’s no question that it can be done. As retailers, it’s up to us to create a relationship with people over the Internet.

Earl: No, I don’t think cars are going to be sold completely on the Internet. Of course everyone’s already doing all their homework there. In the state of Texas, we have 45 documents that need to be completed for at least some transactions with a trade-in. . . I don’t think that transaction in the near-term lends itself to an Amazon.com experience.

Wes: For me, sales are always about relationships. Maybe the technology has caught up with the fact that we could sell a car over the Internet but I don’t think we’ve learned how to establish that same type of loyalty and relationship with a customer over the Internet. Our repeat referral business is the heart of what we do. That’s because people like coming back. Continue reading ›

J.D. Power Asia Pacific Expert Considers Aftermarket Drivers in India

MohitArora

Mohit Arora

Earlier this year, the Competition Commission of India (CCI) served notice to 17 automakers in the country for what the Commission termed to be anti-competitive practices. The charge was that these automakers hold restrictive control on the sales of spare parts to their authorized service networks which, in turn, means high prices to consumers. Mohit Arora, executive director of J.D. Power Asia Pacific, addressed the current situation in an article that was published in Japan’s Nikkan Jidosha Shinmbun (Daily Automotive News) recently. The article, “Drivers of a Vibrant Aftermarket in India,” is excerpted:

“Under India’s CCI ruling, the 17 carmakers will be forced to supply parts in the open market and may have to limit sales to their own dealerships. There are key questions that the industry must face if this ruling holds.

• If this happens, would the authorized networks in the Indian automotive industry be ready to embrace a deregulated aftermarket industry akin to mature markets like the United States, Europe and Thailand?

• Can the two networks survive alongside each other profitably?

• How is consumer behavior likely to change once a reasonable aftermarket option is available to them? Continue reading ›

Lexus Remains Highest-Ranking Brand in CSI; GMC Places Highest among Mass-Market Nameplates

Lexus logo Picture 7For a fifth straight year, Lexus ranks highest in overall customer service satisfaction, and is also the highest-performing Premium brand, while GMC earns the highest score among Mass-Market brands, according to the J.D. Power and Associates 2013 Customer Service Index (CSI) Study, SM which is based on responses from 91,000 owners or lessees of one- to three-year-old vehicles who have taken their vehicle to a dealer for maintenance or repair service in the past 6 months.

At the industry level, both Premium and Mass-Market brands improve by 11 index points this year. Although Premium brands receive the highest scores and represent the top 10 brands in the overall industry rankings, some individual Mass-Market brands made strong strides forward this year. For instance, all four General Motors brands perform well: Cadillac ranks second-highest overall and among Premium brands, and among Mass-Market brands, GMC, Buick and Chevrolet are among the four highest-ranking nameplates, along with BMW Group’s Mini. Continue reading ›

Customer Service Satisfaction Significantly Improves in All Factors

Sutton_Chris

Chris Sutton

At the industry level, overall satisfaction with customer service increases by 10 points from 2012, which is a pretty significant improvement, according to our 2013 Customer Service Index (CSI) Study. Dealerships are making marked improvements in customer service, as index scores in all five factors measured in the study have increased by double digits from a year ago.

Across-the-board improvements may be partly due to the fact that an even larger percentage of customers (77%) are returning to the dealership for maintenance visits rather than for repair work. A year ago, 72% of customers indicated that their most recent visit to a dealer service department was for an oil change or routine maintenance. In addition, due to a contraction in new-vehicle sales during the Great Recession years of 2008-2009, there is a smaller vehicle population and dealers are working harder to grow and retain service customers.

The 2013 CSI Study finds that there is a higher percentage of maintenance visits at the dealership vs. visits for repair work, which aligns with the fact that the quality of vehicles continues to improve, based on the record improvement in initial vehicle quality noted in our 2012 Initial Quality Study (IQS). In addition, we see that customers are coming back to the dealership for maintenance they can schedule in advance, which is definitely more convenient to them—rather than having to set up repairs times, which may be unexpected or unplanned. Continue reading ›