Automotive News - October 6, 2008 - (Page 20) 20 • OCTOBER 6, 2008 service & parts Study: Dealers gain on independent shops Franchised dealerships are earning better marks from service customers, a new study by J.D. Power and Associates concludes. As a result, the study suggests, dealerships are more likely to keep service customers after their vehicles’ factory warranties expire. Tom Gauer, Power’s senior director of automotive retail research, spoke with Staff Reporter Donna Harris about the 2008 Service Usage and Retention Study and its implications for dealers. Closing the satisfaction gap Over the past 5 years, customer satisfaction with dealership service departments has improved, although nondealership shops still have a slight edge, according to a new survey of nearly 13,000 vehicle owners. Scores are on a 1,000-point scale. 2004 2005 2006 2007 2008 Q&A Dealerships Nondealer shops 837 857 845 863 852 873 863 867 866 871 Source: 2008 Service Usage and Retention Study, J.D. Power and Associates What does the study measure? This is a survey of people who own 4- to 5-year-old vehicles. A lot of the traditional 3-year/36,000-mile warranties have expired, and a lot of people start to use nondealers for normal service needs at this point. We look at 32 attributes evaluated by customers on a 10-point scale indicating their level of satisfaction. They include the amount of time the customer waited to speak to a service adviser, the service adviser’s knowledge, the cleanliness and comfort of the waiting room, how prompt the shop is in having the vehicle ready, the quality of service and the convenience of the location. What type of shop has the most satisfied customers overall? The independent garage, or local mechanic, scored the highest. The biggest issue that makes the difference for independent garages is personal interaction. Also, people often use nondealer shops because they think the dealer charges too much for service and is not as conveniently located. Are dealers gaining on independent shops? Over the last five years, the customer satisfaction gap between dealers and nondealers has been narrowing. Dealers excel in the comfort of the facility and the amenities they offer. Another reason dealers are performing better is that they are doing more maintenance work. Over the years, people have been more likely to use nondealers for routine maintenance. But if they had a repair problem, they were more likely to go back to the dealer. Maintenance customers tend to be more satisfied than repair customers. Repairs are more unexpected, inconvenient and costly than maintenance work, so you tend to see a lower level of satisfaction. Nondealer service providers who mostly do basic maintenance have a little advantage over dealers because that customer is easier to deal with. Are dealers getting better at maintenance work? Dealers are trying to make maintenance services more convenient. Many are offering a quick-service lane. Some guarantee customers will get in and out in 30 minutes. And dealers are offering the service at competitive prices. J.D. Power’s Tom Gauer: “Dealers excel in the comfort of the facility.” The study also suggests a shift toward maintenance work and away from repair at dealerships. Since 2000, we have been seeing that shift in our survey of owners of vehicles 1 to 3 years old, as well as the survey of owners of 4- to 5-year-old vehicles. Over the years, because the quality of the products is getting better, repair work is on the decline. For vehicles 1 to 3 years old, the mix eight years ago was 50-50 maintenance to repair. Now, 65 percent of the customers have maintenance done, and only 35 percent visit a shop for repair. For the 4- to 5-year-old vehicles, it makes sense to see a higher incidence of repair. This year, 58 percent of customers reported visiting the dealership for maintenance work. That’s up from 54 percent in 2007. c Chrysler offers service contracts on certified vehicles Arlena Sawyers asawyers@crain.com Owners of certified Chrysler, Dodge and Jeep used cars and trucks now can buy lifetime service contracts that cover mechanical components. Chrysler LLC is charging dealers $520 to $2,100 for the contracts, according to a price list obtained by Automotive News. The company suggests that dealers charge customers $970 to $3,000 for the plans, which offer three coverage levels. Lisa Way, Chrysler LLC’s senior manager of remarketing and certified pre-owned vehicles, says the contracts will cover most certified vehicles for as long as the original certified buyers own them. The new contracts upgrade coverage from the 8-year or 80,000-mile powertrain warranty, and 3-month or 3,000-mile comprehensive warranty that come with every Chrysler certified vehicle purchase. “If you intend to keep your vehicle for a long time, this is added peace of mind,” Way told Automotive News. Each coverage level has a $100 deductible. The plans are: Lifetime Powertrain Care, which covers the engine, transmission and drivetrain. Lifetime Added Care Plus, which also covers brakes, steering, air conditioning, the engine cooling system, front and rear suspension, and the fuel system. Lifetime Maximum Care, which covers virtually the entire vehicle. The warranties are transferable only in Florida and North Carolina. About half of the roughly 3,400 U.S. Chrysler, Jeep and Dodge dealerships take part in the company’s certified program. Jerry Bowman, a Chrysler, Jeep and Dodge dealer in Asheboro, N.C., says he does not participate in the certified program. But he says the new service contracts might prompt him “ If you intend to keep your vehicle for a long time, this is added peace of mind. LISA WAY Chrysler LLC ” to take a second look. “It’s a good program, but we’ve done well without it,” Bowman says. The new service contracts are not available on the Dodge Viper sports car, Sprinter van, Ram Chassis Cab pickup and SRT models. Also excluded are diesels and vehicles used for police, taxi, limousine, postal delivery and ambulance service. Through August, Chrysler sold 89,203 certified used vehicles, a 5.2 percent increase from the year-ago period. c Certified charges Wholesale and suggested retail costs of new “lifetime” extended service contracts for Chrysler LLC certified used vehicles PLAN DEALER COST SUGGESTED RETAIL PRICE Powertrain Care Added Care Plus Maximum Care Source: Chrysler LLC $520 $1,650 $2,100 $970 $2,400 $3,000 http://www.jcowansprotalk.com http://www.jcowansprotalk.com
Table of Contents Feed for the Digital Edition of Automotive News - October 6, 2008 Automotive News - October 6, 2008 Many dealers floored by floorplan limits, costs THE GREAT COLLAPSE September was awful, and 2009 looks ugly GMAC is out of leasing — at least for now Versical, Nussel take new Automotive News posts GM to shut Ohio SUV plant 2 years ahead of plan VW commits to minority purchasing goals in Tenn. Chrysler exec to outline EV strategy at green conference Automakers are high on electrics Dealers give mixed reactions to Chrysler incentive program Chrysler boosts 2009 vehicle prices Lenders move fast to liquidate Heard's stores Mazda Kiyora Toyota, Audi mull tiny cars for U.S. Audi to decide next year on U.S. production Volvo plans diesel hybrid by 2012 Coupelike styling is back in a big way Honda Insight target price: Around $19,000 Mercedes plans U.S. sales of hybrids in S, E, C classes BMW is working on 2 small crossovers VW-Porsche feud risks growth plans Let's get clunkers off the road and spur the economy Europe: Still very different from us It could improve Caddy's image Shouldn't Cadillac try something new? A 4-cylinder is just what Cadillac needs Government's a player in Europe, too The Chevy Cruze should be big news Simple steps would revive industry Ford stops buying nonessential factory supplies Chevy, Mazda execs to speak at congress Automakers find India tough market to conquer Mahle CEO: Most engines will be smaller by 2012 GM begins streamlining purchasing TL stretches factory's flexibility Personnel Study: Dealers gain on independent shops Chrysler offers service contracts on certified vehicles No label Flashes of genius, years of turmoil VW seeks excitement with Routan, CC, Rabbit Sales soft, but Europeans plan to expand lineups 2010 redesign planned for Bentley flagship Alfa beyond Competizione Ferrari: Recession-proof and turning ... green? Maserati: Sporty gets even sportier Uncertainty surrounds Volvo's product plan Rolls-Royce goal: Add customers Panamera: Can Porsche defy skeptics again? Audi longs to join luxury big-leaguers in U.S. BMW plans more variants beyond sedans, wagons Under new owner, Aston Martin back in the race Lagonda's forte: Luxurious sedans that go very fast Couped-up? Lamborghini considers a sedan 250-mph Bugatti boosts the excitement Mercedes returns to the luxury suite Mini follows BMW's lead Smart ambitions, like car, remain small Suppliers cut staff, output to cope with downturn Driver monitoring systems differ High-tech mirrors are poised to make big gains IAC will open first India plant Supplier personnel Engineers call for common electric car standards Land Rover aims to boost the fuel economy of its SUVs Maybach adds open-top 62S Landaulet Saab gets a crossover in 2009; everything else is on hold Jaguar regains its focus on low volume, high end Dealers Economic winds batter Sept. sales Jaguar Land Rover joins group Ford aids minority suppliers CarMax plans 600 job cuts Ruling could ease disputes Feds seek more time for roof strength rule Suzuki seeks floorplan credit partner for dealers Toyota battles Detroit 3 with cheap loans $25 billion: How'd they do that? Peapod: Innovator's little big idea FOR SALE: Heard condos, mansion, jet Is film a flash in the pan? Ford hopes so VW: Next New Beetle will be 'more mature' Renault's U.S. ally of choice? Probably not Chrysler Automotive News - October 6, 2008 Automotive News - October 6, 2008 - GMAC is out of leasing — at least for now (Page 1) Automotive News - October 6, 2008 - GMAC is out of leasing — at least for now (Page 2) Automotive News - October 6, 2008 - Automakers are high on electrics (Page 3) Automotive News - October 6, 2008 - Lenders move fast to liquidate Heard's stores (Page 4) Automotive News - October 6, 2008 - Lenders move fast to liquidate Heard's stores (Page 5) Automotive News - October 6, 2008 - Volvo plans diesel hybrid by 2012 (Page 6) Automotive News - October 6, 2008 - Volvo plans diesel hybrid by 2012 (Page 7) Automotive News - October 6, 2008 - BMW is working on 2 small crossovers (Page 8) Automotive News - October 6, 2008 - BMW is working on 2 small crossovers (Page 9) Automotive News - October 6, 2008 - VW-Porsche feud risks growth plans (Page 10) Automotive News - October 6, 2008 - VW-Porsche feud risks growth plans (Page 11) Automotive News - October 6, 2008 - A 4-cylinder is just what Cadillac needs (Page 12) Automotive News - October 6, 2008 - A 4-cylinder is just what Cadillac needs (Page 13) Automotive News - October 6, 2008 - Simple steps would revive industry (Page 14) Automotive News - October 6, 2008 - Simple steps would revive industry (Page 15) Automotive News - October 6, 2008 - Chevy, Mazda execs to speak at congress (Page 16) Automotive News - October 6, 2008 - Chevy, Mazda execs to speak at congress (Page S-1) Automotive News - October 6, 2008 - Chevy, Mazda execs to speak at congress (Page S-2) Automotive News - October 6, 2008 - Chevy, Mazda execs to speak at congress (Page S-3) Automotive News - October 6, 2008 - Chevy, Mazda execs to speak at congress (Page S-4) Automotive News - October 6, 2008 - Chevy, Mazda execs to speak at congress (Page S-5) Automotive News - October 6, 2008 - Chevy, Mazda execs to speak at congress (Page S-6) Automotive News - October 6, 2008 - Chevy, Mazda execs to speak at congress (Page 16A) Automotive News - October 6, 2008 - Automakers find India tough market to conquer (Page 16B) Automotive News - October 6, 2008 - Automakers find India tough market to conquer (Page 16C) Automotive News - October 6, 2008 - GM begins streamlining purchasing (Page 16D) Automotive News - October 6, 2008 - Personnel (Page 17) Automotive News - October 6, 2008 - Personnel (Page 18) Automotive News - October 6, 2008 - Personnel (Page 19) Automotive News - October 6, 2008 - Chrysler offers service contracts on certified vehicles (Page 20) Automotive News - October 6, 2008 - Flashes of genius, years of turmoil (Page 21) Automotive News - October 6, 2008 - Sales soft, but Europeans plan to expand lineups (Page 22) Automotive News - October 6, 2008 - Alfa beyond Competizione (Page 23) Automotive News - October 6, 2008 - Alfa beyond Competizione (Page 24) Automotive News - October 6, 2008 - Alfa beyond Competizione (Page 25) Automotive News - October 6, 2008 - Rolls-Royce goal: Add customers (Page 26) Automotive News - October 6, 2008 - Rolls-Royce goal: Add customers (Page 27) Automotive News - October 6, 2008 - Panamera: Can Porsche defy skeptics again? (Page 28) Automotive News - October 6, 2008 - Panamera: Can Porsche defy skeptics again? (Page 29) Automotive News - October 6, 2008 - BMW plans more variants beyond sedans, wagons (Page 30) Automotive News - October 6, 2008 - Couped-up? Lamborghini considers a sedan (Page 31) Automotive News - October 6, 2008 - Smart ambitions, like car, remain small (Page 32) Automotive News - October 6, 2008 - Suppliers cut staff, output to cope with downturn (Page 32A) Automotive News - October 6, 2008 - Driver monitoring systems differ (Page 32B) Automotive News - October 6, 2008 - High-tech mirrors are poised to make big gains (Page 32C) Automotive News - October 6, 2008 - Engineers call for common electric car standards (Page 32D) Automotive News - October 6, 2008 - Jaguar regains its focus on low volume, high end (Page 33) Automotive News - October 6, 2008 - Dealers (Page 34) Automotive News - October 6, 2008 - Dealers (Page 35) Automotive News - October 6, 2008 - Dealers (Page 36) Automotive News - October 6, 2008 - Dealers (Page 37) Automotive News - October 6, 2008 - Dealers (Page 38) Automotive News - October 6, 2008 - Dealers (Page 39) Automotive News - October 6, 2008 - Dealers (Page 40) Automotive News - October 6, 2008 - Economic winds batter Sept. sales (Page 41) Automotive News - October 6, 2008 - Economic winds batter Sept. sales (Page 42) Automotive News - October 6, 2008 - Feds seek more time for roof strength rule (Page 43) Automotive News - October 6, 2008 - Toyota battles Detroit 3 with cheap loans (Page 44) Automotive News - October 6, 2008 - Toyota battles Detroit 3 with cheap loans (Page 45) Automotive News - October 6, 2008 - Renault's U.S. ally of choice? Probably not Chrysler (Page 46) Automotive News - October 6, 2008 - Renault's U.S. ally of choice? Probably not Chrysler (Page 47) Automotive News - October 6, 2008 - Renault's U.S. ally of choice? Probably not Chrysler (Page 48)
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