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Optimism sees manufacturer/retailer relations hit six-year high

Consumer confidence has brought about a boost to the relationship between retailers and their brands, but not everyone is happy

An uplift in consumer confidence post-lockdown has resulted in a six-year high for the results of the latest NFDA Dealer Attitude Survey.

For the key question ‘How do you rate your manufacturer overall?’ retailers scored their brand partners an average of 6.5 out of 10. The last time the score was this high was at the start of 2015, however, scores have been improving for the past two years indicating a closer working relationship during the pandemic for the majority of brands.

Lexus, once again, came top overall with a score of 9.7 with sister firm Toyota equal second with Kia (9.6).

Hyundai, once again, came last with a score of 3.1 while Stellantis brands Abarth (3.8) and Fiat (4.2) completed the bottom three.

While five of the bottom 10 brands were from Stellantis, and all Stellantis brands were in the bottom half of the chart, the group also had some manufacturers that ranked among the most improved. Alfa Romeo saw its score rise 3.2 points to 5.0 while DS and Jeep were up more than 2.0 to 6.3 and 5.0 respectively.

Citroen and Peugeot, however, were two of the three fastest fallers dropping 1.1 and 0.7 points respectively in the latest NFDA survey.

The big fallers

Skoda saw the biggest drop of 1.3 points to a score of 5.5 for the ‘How do you rate your manufacturer overall?’ question.

This represented a bigger drop than the brand’s overall average, though, which points to some dissatisfaction in specific areas. According to the scores, Skoda retailers are much less happy with the management at Skoda than they were last time out, with the average response to the question ‘Does the management of your manufacturer take dealers’ views and opinions into account?’ dropping from 6.6 to just 4.9 – a fall of 1.8 points.

This was the biggest individual score fall, but the question: ‘How satisfied are you with your ability to do business with your manufacturer on a day-to-day basis?’ also saw a fall of 1.3 points, dropping from 7.0 to 5.7 points. It saw a fall in its score across almost every question although most were by a smaller amount.

The brand’s previously high scores, and retailers’ satisfaction with its future alternative fuel offering, prevented it from recording a worse result.

Hyundai remained at the bottom of the table but the brand has at least arrested its decline in scores, with both the rating and its average score improving fractionally compared to the previous survey.

Retailers still only rated Hyundai at 3.1 out of 10, but this represents an improvement of 0.3 versus last time out. The average score only went up by 0.2 points though. This wasn’t helped by the fact that Hyundai retailers clearly don’t rate the manufacturer’s training provision – when asked to rate the quality of training, dealers scored it at 3.6, which is a drop of 1.7 points. This is the biggest fall of any brand in this area.

The rating for Hyundai’s alternative fuel offering took a kicking, too, with the satisfaction score falling from an above average 8.7 to a mid-table 6.2.

Mini retailers are in what might be seen as a strange situation. They rated their brand at 7.6, down from 8.1 last time out, but the average score fell by 1.0 point when all the categories were considered. Profit return and margin were the biggest reasons going by the scores.

The areas on the up

Even though the general trend was for scores to go up, there were a few areas where brands saw particularly notable increases.

Alfa Romeo’s big rise in the overall rating was echoed across the questions, with the brand recording the biggest rise in all bar four categories. Although this will be of great reassurance to both retailers and the manufacturer’s management, there is still a long way to go. Despite the notable rises, Alfa Romeo didn’t have a single score that registered as above average, although the brand’s own improvement will have naturally pushed that average up.

Alfa Romeo’s rise obscures a few more notable winners, with Dacia recording some big score jumps. Its biggest improvement comes in retailers’ happiness related to Covid support, but it seems that dealers are also happy with brand management as they feel their views are listened to (6.0 up from 4.7 last time out) and performance measures are fair and reasonable (6.3 up from 5.0).

DS and Jeep also saw good rises, with the former one of the happier brands when it comes to Covid support – the score rose from 5.8 to 7.3 on that front. DS retailers are also pleased with their margins on new and used cars, their targets and the standard of brand training. The required level of investment is the main factor preventing the brand from a higher overall score.

Jeep’s big leap is in its profit return and margins but, like Alfa, it has a long way to go and doesn’t score above average in any one area.

Commenting on the results Sue Robinson, NFDA chief executive, said: “It is positive to see that dealers’ satisfaction levels with their manufacturers have improved across most business areas; as consumer confidence returns and the economic environment continues to recover, there are reasons to be optimistic about the months ahead.”