The threat of regulation is knocking the confidence of franchised dealers and is just one of the factors leading them to demand more training and support from their service providers. The winners of the AM Reader Recommended 2014 awards highlighted the trend at a recent AM roundtable discussion. Attendees said they were increasingly supporting franchised dealer customers because of a “nervousness” over regulation and concern about forced changes to their sales processes.
David Parrondo, general manager, Mapfre Abraxas, said the demand for training for non-regulated products and FCA compliance was a good opportunity, because it would make dealers review their product strategies, which would benefit suppliers with good products, good systems and good training.
Black Horse managing director Chris Sutton said his company was also offering dealers support to understand and comply with the new consumer credit rules.
“We are providing our dealer partners with guidance and training to ensure that they are able to implement these changes. This includes information and support through our dealer portal, training sessions and our managers are investing the time to meet with dealers to provide additional assistance on what the changes will mean for their business.”
Car Care Plan chief executive Tim Heavisides said recommendations from the FCA would have a significant effect on the marketplace and its proposed remedies could seriously damage GAP in the dealer channel.
He warned that the FCA’s behaviour was “inconsistent” and it seemed intent on not just putting the customer at the centre of the business, but on preventing dealers selling GAP at the point of sale. He said the FCA’s mechanism for determining the true value of a regulated product ignored the purpose of insurance in transferring risk and giving peace of mind, and the consumer value attached to that transfer varies depending on the individual.
“The remedies are detriment, frankly, and that’s why we’re so keen to persuade them to come up with alternatives,” he said.
Emac consultant Graham Filmer said the way cars were sold would have to change and pointed out how mortgage market brokers used to make lots of money, but now have to charge a fee because they cannot earn a commission.
“Car dealers might just have to earn money from the metal, which will be a shock. This may strip it all back, but then I suspect car prices would have to rise,” he said.
Five of the AM Reader Recommended 2014 winners: (L-R) Tim Heavisides, chief executive, Car Care Plan; Angela Barrow, chief executive, Emac, Sue Healey, key account manager, Supagard; David Parrondo, general manager, Mapfre Abraxas; Stephen Meadows, development director, Pinewood