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Recession brings dealers and manufacturers closer

Dealers and manufacturers have been brought together in a show of solidarity against the adversity of the recession, with almost three quarters more satisfied with the relationship.

Almost all dealers (91%) have become more satisfied by the profit return represented by their franchise since the winter, according to the RMIF’s National Franchised Dealers Association (NFDA) Summer 2009 Dealer Attitude Survey.

The results were based on 1,076 respondents to the survey representing a total network size of 4,688 franchised dealer sites.

The RMIF said figures for the network sizes were provided direct from the manufacturer. 

AM asked some of the manufacturers that performed well and also ones that performed poorly how they would improve or maintain the relationship they have with their networks.

How do you rate the partnership you have with your manufacturer (out of 5)?

  • Audi: 4.2 (improvement of two points)
  • Kia: 4.3 (improvement of seven points)
  • Chrysler, Jeep and Dodge: 2.1 (decrease of three points but only seven sites responded)
  • Citroën: 2.9 (decrease of one point)
  • Subaru: 3.0 (decrease of four points)

Kia

Michael Cole, managing director, was pleased with the improving partnership with dealers, but said the carmaker would not rest on its laurels.

His focus is on maintaining volume and network profitability when scrappage ends.

Demonstrator and stocking costs plus speed of bonus payment have all been tackled.

He added: “We have worked to deliver additional retail volume with similar margins to 2008.”

Audi

Audi UK has worked to get stocking and demonstrator costs down for its network in 2009, said a spokeswoman.

A support package has extended the network’s consignment periods, it provided a fund to assist with the sale of stock cars and demonstrator requirements have been realigned, it said.

Audi increased communication between itself and its dealers in 2009, including completely revising its dealer council and sub-groups, which now meet bi-monthly instead of quarterly.

Chrysler

Chrysler highlighted that the survey included seven respondents from its network total of 50 sites.

It added that the network was realising strong returns for the first time in three years and the number of profitable dealers has trebled compared to 2008.

“The majority of the Chrysler network in the UK is now profitable with our upper quartile dealers experiencing a return on sales of more than 3.2%,” said a spokeswoman.

Citroën

Marc Raven, communications director, said the results from the survey were not unexpected given the franchise’s ongoing reorganisation.

Efforts to engage with dealers include a roadshow and presenting its new sales strategy at its national dealer conference next month.

Raven said the brand was determined to increase volume, “which is a key driver of dealer profitability and dealer satisfaction”.

Subaru

Paul Tunnicliffe, managing director, said Subaru was “ready for a kicking”.

He put its decrease down to previous tactics encouraging self-registrations, demanding too many demonstrators and the decline in profitable STi sales.

“We want dealers to be making 2.5% return on sales next year and not all the network is profitable right now,” he said.

For more insight on Subaru’s sales strategy for the UK see the October 23 issue of AM. 

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