Shorter Vehicle Delivery Time Impacts Dealership Selection in India

India02Although dealer proximity is still the most influential reason for choosing a dealership in India, new-vehicle buyers cite immediate delivery as an emerging key consideration, according to our 2013 India Escaped Shopper Study (ESS). More than one-sixth (16%) of customers cite immediate delivery as the most influential reason for selecting a dealer, up from just 8% in 2009.

In addition, a longer delivery time is cited by new-vehicle buyers as the second-most influential reason to reject a vehicle that shoppers had initially considered purchasing. The interest in vehicle delivery is related to the final decision process. Once the decision is made and the payment and other processes are completed, new-vehicle owners want to immediately show off their prized possession. Continue reading ›

Western Auto Conference Industry Panelists Discusses Self-Driving Cars

 Today’s post follows up our earlier post, Western Auto Conference Panel Talks about Mobility—Now and in the Future and includes excerpts from a panel of auto industry executives about alternative vehicles and car sharing with perspectives on smarter, semi-self-driving vehicles and a few comments about the future of mobility and selling electric vehicles. Joe White, senior editor at The Wall Street Journal, led this discussion with auto executives and a California dealer principal at the NADA/J.D. Power Western Automotive Conference. Continue reading ›

Western Auto Conference Panel Talks about Mobility—Now and in the Future

Auto industry panelists discuss mobility with Joe White, senior editor, The Wall Street Journal (right) at the NADA/J.D. Power Western Automotive conference.

Auto industry panelists discuss mobility with Joe White, senior editor, The Wall Street Journal (right) at the NADA/J.D. Power Western Automotive conference.

Mobility is a term that has been gaining attention in the auto industry. The current focus is on the viability of alternative vehicles—especially electric vehicles (EVs)—and the future focus explores mobility technology including smarter, semi-self-driving vehicles. Joe White, senior editor at The all Street Journal, led a panel discussion with auto executives and a California dealer principal at the NADA/J.D. Power Western Automotive Conference with an objective to look at mobility and to separate reality from fantasy.

Moderator: Joe White, senior editor, The Wall Street Journal

Panel members:

Al Castignetti, vice president and general manager, Nissan Division, Nissan North America, Inc.

Mark Del Rosso, COO, Audi of America Inc.

John Mendel, Executive Vice President, American Honda Motor Co., Inc.

Peter Hoffman, Dealer Principal, Sierra Autocars, Inc.*

*Sierra Autocars, Inc. is s a family-owned dealer group based in California’s San Gabriel Valley, and includes seven stores and 10 franchises: Acura, Chevrolet, Chrysler, Dodge, Fiat, Honda, Jeep, Mazda, Ram and Subaru.

Panelists’ comments on the need to have a balanced portfolio that includes fuel-efficient vehicles, including those with alternative powertrains, and their ideas about consumer interest in EVs, alternative powertrains and semi-self-driving cars are excerpted.

Joe: Let’s start with the here and now. By 2025 the auto industry’s fleets have to average 54.5 mpg—you are not waiting until 2024 to start this process. How are customers receiving the technology and the engineering ideas that you are putting into the marketplace to move toward that goal?

Al: No car manufacturer is going to get to 54.5 mpg without alternative fuel vehicles—whether it’s electric, fuel cell, or whether it’s natural gas. Nissan is heavily involved in the electric vehicle (EV) and that is one of the platforms moving forward that is going to have a big presence in the auto industry. I would say that from an electric perspective for us, our customers love it. The one limit right now is the range. As the technology expands, and you get greater range from the same power packs, I think it will open up a tremendous audience that isn’t there today. Continue reading ›

Cross-Shopping Multiple Models Increases In India

Mohit Arora

More of India’s new-vehicle buyers are shopping around and looking at multiple vehicles during the car-buying process than ever before. This year, 28% of new-vehicle buyers in India considered one or more vehicles before making their ultimate purchase decision, which is up from just 23% in 2011, according to our 2012 India Escaped Shopper Study.

Repeat buyers tend to be driving this trend of cross-shopping. One-third of these buyers (those who are purchasing a second vehicle or replacing a household vehicle) considered one or more models during their shopping activity this year—up 9% from 2011. In contrast, first-time buyers tend to be more conservative and their cross-shopping rate remains largely unchanged from 2011 at 20%.

Our study also finds that repeat buyers are more involved in the shopping process and are more likely to visit a dealership and test drive new models before making their purchase decision. It appears evident that the increase in cross-shopping has also risen due to the launch of several new models and a wider range of vehicle choices in the market. Continue reading ›

Service Satisfaction among Japan’s Mini-Car Owners is a Major Challenge

Taku Kimoto

The mini-car segment in Japan continues to gain share and attract more attention, accounting for one-third of total industry sales. Traditional mini-car brands—mainly Daihatsu and Suzuki—are competing in a tight market with Japan’s six mass-market brands—Toyota, Honda, Nissan, Mazda, Subaru and Mitsubishi. Some, including Honda, are launching their own tiny models with engine sizes of 660 cc or less.*

The competition between mini-car brands and mass-market brands is presenting a severe challenge to satisfying customers with after-sales service—especially among those vehicle owners who have switched from domestic mass market brands to mini-car brands, according to our 2012 Japan Customer Service Index (CSI) Study.

This year, overall customer satisfaction with service performed at automotive dealer facilities averages just 617 index points (on a 1,000-point scale), which is down from 623 in 2011. Continue reading ›

A Recipe for AutoNation: Considering Different Franchises

Mike Jackson, chairman and CEO of AutoNation, and moderator of a panel discussion at our recent J.D. Power International Automotive Roundtable, gave a quick appraisal of whether AutoNation would consider acquiring franchises belonging to three automakers, whose executives participated in the event’s panel discussion.* Below are Jackson’s comments about Chevrolet; Chrysler Group brands, including Fiat; and Hyundai:

“When it comes to Detroit products, our portfolio strategy is basically one-third Detroit; one-third Asian; and one-third—premium luxury—overweighted very much to the Germans.

“When I look at General Motors, I say, there will always be a Chevrolet and I absolutely am in the market for Chevy stores in metro markets. We’re a metro player. Continue reading ›

Fleets and Leasing Will Still Have a Role in U.S. Auto Industry

Automaker sales and marketing executives and retailers gave their views on product allocation, fleet sales, leasing and more during an afternoon session at the recent International Automotive Roundtable. Panel moderator Mike Jackson, chairman and CEO of AutoNation, the largest public automotive retailer in the U.S., led the Q&A. This second post features some more excerpts from panel members:

Panel Members:

Alan Batey —Vice President, Chevrolet Sales and Service, General Motors Company

Reid A. Bigland —President & CEO, Dodge Car Brand & Head of U.S. Sales/President and CEO, Chrysler Canada, Chrysler Group LLC

Stephen W. Wade —President, Stephen Wade Auto Center and 2011 Chairman, National Automobile Dealers Association (NADA)

Dave Zuchowski —Executive Vice President, National Sales, Hyundai Motor America

Q: Mike: Reid, what’s the future role of fleet sales going forward? You were over-dependent during the crisis. Is that fair to say? And where do you think you will be able to get?

Reid: Right. Last year, our retail sales increased 43%. Total sales were up 26%. Our ratio of fleet sales dropped dramatically throughout 2011.

Q: Mike: At the worst, it was what?

Reid: We were probably 33% or 35% fleet. But I have always said that fleet is still an integral part of our business plan. There’s no such thing if you think about it as a bad customer. There’s just a bad deal. And if somebody wants to buy one car, all of a sudden that’s a good customer. Somebody wants to buy five—that’s a bad customer. It’s just a matter of managing the residuals, accounting for that risk, and making sure that they don’t have long-term damage to brand your particular products. If you can balance that, then fleet can be a real asset for your company—a money maker. Continue reading ›

How Do Buyers Want to Learn About Their New-Vehicle Features and Controls?

Zeeshan Hasan

In our 2011 Sales Satisfaction Index Study (SSI), J.D. Power asks buyers questions about what level of detail they prefer when receiving feature demonstrations during the vehicle delivery process, and how they would like to learn about their new vehicle’s features and controls after they have taken delivery.

A majority of buyers (81%) identify that they would prefer a “detailed” or “moderate” explanation at delivery, while only a small portion (19%) indicate that they would prefer a “brief” explanation. This is further demonstrated by the fact that while technology demonstrations add, on average, 5 to 6 minutes to the length of a vehicle delivery, the added demonstration time also improves a buyer’s overall delivery satisfaction by at least 100 points, improving their satisfaction with the thoroughness and timeliness of delivery. Continue reading ›

New-Vehicle Buyers Perceive Value in Extra Time Spent on Technology Demos

This year, overall satisfaction with the new-vehicle sales experience improves by 13 index points to an average of 648 (on a 1,000-point scale) from 635 in 2010, according to results in J.D. Power’s 2011 U.S. Sales Satisfaction Index (SSI) Study, which is based on responses from more than 24,000 buyers and lessees who purchased their new-vehicle in May 2011.

A likely reason for the double-digit increase in satisfaction is that automakers and dealers are upping their investments and renewing their focus on providing buyers with a more satisfying retail experience. All four buyer factors* measured in the new-vehicle purchase process improve this year from 2010.

The most significant gain this year is in delivery process, despite the fact that the average length of time to complete the delivery portion of a new-vehicle sale has increased by four minutes, to an average of 32 minutes. We find that a major reason for the longer delivery process is the high percentage of buyers (88%) who said they received an in-depth demonstration of technology in their new vehicle (including audio, entertainment, navigation and communication systems), which results in more time spent at the dealership. Continue reading ›

Satisfaction: Much Higher for Prompt Vehicle Service in Australia

Mohit Arora

Vehicle owners in Australia who wait less than 3 hours to have their vehicle serviced at an authorized service center are much more satisfied with the service experience than are those owners who are forced to wait longer, according to the J.D. Power Asia Pacific 2011 Australia Customer Service Index (CSI) Study.SM

In fact, service satisfaction* for shorter vehicle service wait times is 41 points higher (817 points on a 1,000-point scale) than for wait times of 3 or more hours (776). At the same time, the study reveals that nearly six in 10 customers (59%) have to wait more than 3 hours before their vehicle is returned to them after service, and customers wait an average of 6 hours for their vehicle to be serviced. Continue reading ›