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Steve Hood on TrustFord's new horizons

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Long-distance relationships are notoriously difficult, but the directors of the TrustFord network are confident they can make it work – despite a near 6,000-mile separation.

Steve Hood, TrustFord’s chairman and chief executive, will continue in his post with the group, which is owned by Ford, despite being promoted by Ford Motor Company to the role of vice-president of sales for the Asia Pacific region.

Hood is now based in Shanghai, but insisted things would remain “business as usual” at TrustFord.

Although Hood refused to comment further on the logistics of his new role, he told AM: “The business has matured a lot over the last couple of years. We’ve improved performance significantly, introduced good, simple management processes and have a strong and capable management team in place. This frees up my time to get involved in other projects and roles for Ford while still staying involved in the TrustFord businesses.”

TrustFord appears to be in a buoyant position – it posted  a record £1.63 billion in turnover for the year to December 31, 2015 (up 13.2% from £1.44bn the year before), and an operating profit of £14.3 million (up 51.3% year-on-year from £9.5m). In fact, its operating profit figures were bettered only by the 2009 (£17.6m) and 2010 (£14.7m) scrappage years that followed the 2008 banking crisis. It was the AM100’s eighth largest dealer group this year (up from ninth in 2015).

The group has built six Ford  Stores since the start of 2015 – Bristol, Castleford, Epsom, London, Warrington and Lisburn, Northern Ireland  – taking its total number of sites to 53.

Hood said the group would sell more than 100,000 vehicles in 2016, about 40,000 of which will be fleet. New and used business will be evenly split, he said.

TrustFord is targeting growth in all directions, but particularly its used car and fleet capacity.

The group is expanding its Long Marston fleet distribution site to create a national fleet hub of 22.5 acres (up from seven) to streamline the delivery of business and commercial vehicles and, potentially, reduce the cost of used cars coming off fleet onto its recently expanded used car forecourts.

It has created an aftersales app that aims to improve retention and post-sale services by allowing customers to access the technical specification of their car, view their service schedule and book services from their mobile phone.

Customers will also be able to gain directions to the nearest car park and access the latest offers available within the group.

 

Why Ford dealers need to keep an open mind on mobility

Speaking to AM in the latest addition to the TrustFord network – the £4m flagship Epsom FordStore – Hood described the app as “a real taste of things to come” as the group’s parent company targets alternative ownership solutions and connected motoring innovations.

The group has so far received few enquiries about electric vehicles (EVs) and was “pragmatic” about their eventually widespread use, but Hood said: “Customers’ needs and expectations are starting to change.

“The new app is just a part of that. Sooner or later, things are going to change significantly. It’s reassuring that Ford are working with a number of partners to ensure that we will be at the cutting edge of any advances.

“From my point of view, as a dealer, I’m getting excited about some of the things that Ford are talking about by way of the mobility solutions, because they are exploring the possibilities rather than betting, say, on this car line or derivative – i.e. EV, hybrid or fuel cell – and saying this is the one. That is going to be quite hard to predict.”

Ford is currently working on evasive steering technology that can swerve a car around hazards and plans to test autonomous cars on European roads in 2017. It is moving towards the launch of a fully autonomous car, supported by ride-sharing and car-hailing programs, by 2021.

The US carmaker has also signed a deal with the former smartphone manufacturer, Blackberry, to develop its next generation of connected cars and another partnership, with online retailer Amazon, will allow cars to communicate with customers’ household devices.

Hood, who spent three years working as the director of sales operations in Ford of Europe, following an initial spell at TrustFord – where he has been responsible for dealer network strategies and developing the retail experience for Ford customers – said Ford dealers need to be open to how these technologies may change the business.

“In Germany, there’s quite a lot of that ZipCar stuff and the message from Ford is that that is part of their strategy.

“London is a market that will have to deliver that, of course, so it’s something that you have to think about as a dealer in London.

“I think we’re all going to have to be very open-minded towards sharing and pay-to-use and that’s the thought that we have to have. That one day we will have to provide for a customer that wants to pay as they use.”

 

The Ford Store effect

TrustFord has been at the forefront of the Ford Store concept.

Showrooms have a single reception area, new interactive displays and Wi-Fi-equipped lounge areas. They are divided into sections defined by lighting, colour palate and furniture to segment performance cars, such as the Mustang and Focus RS, core products such as the Fiesta and Focus and the Vignale premium offering, which now includes Mondeo, S-Max, Kuga and Edge models.

Hood believes the new format will not only benefit customers, but will help boost staff retention and attract a more diverse workforce.

TrustFord’s first female general manager, Lucy Curtis, runs the new Epsom FordStore, along with five other facilities in the business’s Surrey and Henley market area.

Hood said Curtis’s drive and talent were what took her to the top job, but he acknowledged a need to bring more women and young people into the industry and said showroom facilities have an important part to play.

He said: “I think it’s important for the staff to have a workplace like this. The workshop is bright and clean, a very professional space.

“I think we have an environment where people are proud to come and work. I think when you do those things, being vigilant on your culture and creating an attractive place to work, you cannot fail to bring through the diverse workforce you need.”

Ford sold a total of 297,575 vehicles in the first 11 months of 2016 – down 4.63% on the same period in 2015. It also dropped almost a percentage point in market share over the same period, from 12.72% to 11.83%.

 Looking at individual model lines over the same timeframe, the Fiesta’s 124,457 registrations were down 9.6% year-on-year, with the Focus down 16.8% on 65,554.

A new Ford Fiesta – including a premium Vignale model – was unveiled to the press at an event in Cologne during November and will reach Ford dealerships in June.

TrustFord is clearly broadening its interest in used cars and fleet ahead of next year’s anticipated fall in new car sales, but Hood believes Ford’s SUV line-up can take advantage of many customers’ move away from the traditional hatchback models to help bolster the brand’s fortunes.

He said: “We’ve always been strong in Fiesta and Focus and Mondeo and what we are starting to see now is that the bigger product range is enabling us to take advantage of the market much better and the SUV range is growing.

“SUV is the one that will work hardest for us this year.”

Hood said TrustFord’s retail share has risen in London during 2016 on the back of its stronger premium offering.

“We’ve started to see the range better cater for customers that are quite affluent. I think RS, Vignale and Mustang are all giving us access to that premium market.”

Curtis, meanwhile, said the Epsom store has its own weapon in the fight for performance car sales – Mustang specialist James Rowe.

Even before the Epsom FordStore’s opening in June, Rowe’s Mustang sales were into three figures and his activity on Twitter and Ford owners’ forums was boosting the dealership’s reputation as the place to go to invest in the blue oval’s coupé.

Curtis said: “James has been hugely successful with the Mustang. To him, TrustFord is more than just a job, he loves it.”

 

Putting the focus on fleet

TrustFord’s investment was no better demonstrated than its ongoing development of its Long Marston fleet hub from seven to 22.5 acres, with on-site logistics specialists, bodyshop and refurb centre.

Due to be fully operational by Q1 2017, the new facility will have an annual throughput of about 40,000 vehicles, according to Hood – roughly TrustFord’s fleet and commercial vehicle volume. It will also serve the group’s five regional business centres and 16 Transit Centres.

Hood said: “We have invested very heavily in fleet and commercial vehicles. It’s a huge part of our strategy. We’ve got the dedicated Transit Centres, we’ve got a dedicated fleet team and we have the solutions within that, whether it’s contact hire and leasing.

“Probably about 40% of our volume is fleet and CVs.”

Hood suggested that the new fleet hub could also prove a vital source for used cars. Increased used car capacity was a big part of recent refurbishment work in its Dagenham, Birmingham, and Castleford sites, as part of a drive towards “professionalising” TrustFord’s used operation.

Used car capacity has grown by about 15% across the network and 100% at the new Epsom site.

On sites with less space, dealers have been working towards becoming more internet-savvy, and use supporting compounds to boost their ability to turn stock.

Commenting on the fleet centre’s potential role in the supply of used vehicles, Hood said: “We will be able to do the first stage of the vehicle remarketing process.

“We have a refurbishment facility with the compounds there where we can put them through prep and put them into the used market whether they are coming back, whether they are our own vehicles or whatever.”

 

TrustFord ‘exploring’ ways to sell online

Developments away from the bricks and mortar of new dealerships and expanded forecourts are increasingly central to TrustFord’s drive to appeal to a new generation of internet-savvy customers.

Half a million pounds has been spent on upgrading the group’s Wi-Fi networks to better serve the wireless devices used by sales executives and meet the expectations of smartphone-using customers.

Hood said the group was also “exploring” an online car-buying model that would allow customers to transact as they wished within the next year or so.

“Usually, customers want a conversation around the car, but I remember selling our first car online when I first joined

TrustFord five years ago, which was wonderful,” he said.

“If you look at the finance providers, they are progressing fast. When we first did that five years ago, you would sign the documents on-site. The finance providers now have remote solutions.”

TrustFord operates two call centres – in Birmingham and East London – which are the first point of contact for customers using TrustFord Online. Call handlers determine a customer’s needs before directing them to a relevant site to progress their enquiry, said Hood.

The East London centre is wholly committed to the servicing side of the business and was instrumental in booking more than a million workshop hours in 2015.

The call centre employs a mixture of full-time and part-time staff with specialist knowledge of sales or servicing areas of the business.

 

People processes ‘cut attrition rate by 10% in one year’

Hood would not be drawn further on a move away from “heavily commission-led” packages for sales executives, but he did emphasise a growing need to recruit the right people and deliver training and progression.

“We’ve put a lot of investment into staff recruitment and induction in order to ensure that employees get proper training. They only speak to customers when they are properly trained,” he said.

“All staff have a support network when they are new and that makes them happier. We want happy employees because we think it benefits customer satisfaction.”

TrustFord has centralised its recruitment processes away from its dealerships.

Recruitment sessions follow an online application and an assessment centre where applicants must meet a minimum standard.

Successful candidates go through to an induction process and an induction academy, which takes sales staff two weeks to complete. Once people have joined a site, they are supported by a buddy system.

The process has paid dividends. Hood said: “Our attrition rate came down quite dramatically last year – by over 10%.

“It’s one of the things we are most proud of. We were listed in the Top 25 Best Companies to Work For by The Sunday Times as a result and I think that really shows a commitment from our HR team to embrace that cultural imperative to become a great place to work.”

As Hood leaves behind a great place to work, he will be left to tackle a new cultural imperative: making his roles in the UK and Asia work well in unison.

 

‘We need more women in the industry’

TrustFord’s first female general manager says women can progress in the automotive retail sector despite the long hours, suggesting “that’s just retail now”.

Lucy Curtis has progressed from trainee sales executive at the group’s Dagenham retail site to general manager of six sites across the group’s network, including the new £4 million Epsom FordStore.

Curtis said: “It is a lot of hours. If you are a young female and you have to work five-and-a-half days a week, then it can be very difficult, but that is the retail environment now, no matter what area you are working in.

“There is no doubt that we need more women in the industry, but I suppose women just do not associate with cars as they perhaps do with other areas of retail.”

Curtis said TrustFord supported her from day one, identifying her ambition and encouraging her to progress through the business. A ‘buddy system’ provided her with support along the way.

She said: “I joined Dagenham Motors as a trainee sales executive back in 2004 and was promoted to the role of business manager 18 months later.

“After four years, I became a sales manager and 18 months ago I became general manager.

“I think I pushed myself, but the company identified that I was ambitious and helped me to progress.”

In June, Curtis orchestrated the bringing together of TrustFord’s former Epsom dealerships at Kiln Lane and East Street in a single 18-vehicle showroom facility incorporating a 17-bay workshop and a specialist Transit Centre.

She did not want to close the business during the transition and helped her 50-strong team make the move overnight.

Hood said TrustFord was very proactive in terms of promoting from within and wanted to create a level playing field for female members of staff, but would not prioritise them for promotion: “We’ll make as much effort as we can to ensure everyone gets a fair chance.”

Cultural changes were starting to bear fruit, he added: “Female service managers in the business are some of our great performers. We have female technicians and we bought equipment that ensures they don’t have the same stresses, such as wheel trolleys that facilitate half-height lifting. We want to make sure we’re a diverse employer.

“I think it will take more time to filter through. It’s a job not finished.”



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