Automotive News - August 4, 2008 - (Page 15) AUGUST 4, 2008 • 15 service & parts Service survey: Customer satisfaction rises Study shows shift from repair work to maintenance Andrew Grossman agrossman@crain.com Service satisfaction These are the best- and worstperforming brands in J.D. Power and Associates’ 2008 Customer Service Index Study, which measures satisfaction with dealership service. Scores are on a 1,000-point scale. THE BEST Just 35 percent of auto dealership service customers are bringing in their new vehicles for repairs rather than routine maintenance, a new study by J.D. Power and Associates concludes. That’s the lowest ratio of repair to maintenance work in the 28 years Power has conducted its survey of service satisfaction. The study finding is good news, in that it reflects an increase in vehicle quality. But it also places more pressure on dealerships to attract and keep customer-paid service work to make up for a decline in warranty work, the survey suggests. “The industry continues to get better,” said Tom Gauer, who directs Power’s Customer Service Index Study. “At the same time, I think customers’ expectations continue to rise.” ■ Jaguar: 923 ■ Cadillac: 922 ■ Buick: 919 ■ Lexus: 915 ■ Lincoln: 913 THE WORST ■ Isuzu: 782 ■ Volkswagen: 842 ■ Kia: 844 ■ Scion: 845 ■ Suzuki: 846 Source: J.D. Power and Associates 2008 Customer Service Index Study For this year’s study, Power surveyed 87,302 U.S. owners and lease customers of new vehicles from the 2005-2007 model years. The survey, conducted from January through April, measured respondents’ service experiences. Power released the survey results in mid-July. Gauer said the shift in emphasis from repair to maintenance work could simplify operations at dealership service departments. “It might make it easier for them just to focus on the core maintenance issues and not worry as much about parts,” he told Automotive News. This year’s study found that overall customer satisfaction with dealer service increased from 2007. Respondents’ satisfaction with repair work rose by nine points on the survey’s 1,000-point scale, to 894. Satisfaction with maintenance work rose by three points, to 862. For the second straight year, Jaguar led the 37 brands in the study with 923 points. Luxury brands captured seven of the top nine spots. Isuzu scored worst for customer satisfaction with dealership service with 782 points, 60 points below the J.D. Power’s Tom Gauer: “The industry continues to get better.” next-lowest-scoring brand, Volkswagen. The survey suggests ways that service departments can boost customer satisfaction: Explain your work. Customer satisfaction was about 100 points higher when the service department described the work that was done and the reasons for the charges. Fewer than two out of five survey respondents said the dealership explained their bills. Return a clean vehicle. Respondents who said their vehicles came back cleaner from the service department gave scores that were 48 points higher on average than those who didn’t. Customers whose cars and trucks were dirtier upon return averaged a 202-point average drop in satisfaction. Don’t keep the customer waiting. Customers who spoke with a service adviser as soon as they got to the dealership had average satisfaction scores 224 points higher than those who reported waiting five minutes or more. c Software helps dealers manage parts Alysha Webb awebb@crain.com In and out of stock Poor parts inventory management afflicts a dealership in at least 2 ways. 1. Carrying unneeded or obsolete parts wastes money. 2. Lacking needed parts delays repairs, annoying service customers. dealership whose inventories are centrally managed. Brunk says Partsedge has helped weed out more than $30,000 worth of obsolete parts. “Instead of having stuff on our shelves that wasn’t going to move, now we have nice, fresh inventory,” Brunk told Automotive News. “When you can control your cash like that, it gives you a competitive edge.” Suppliers and automakers are finding customers for software systems that promise to help auto dealerships manage parts inventories better. Stocking obsolete or surplus parts can cost dealerships money. A lack of needed parts can alienate customers when that absence delays repairs. “Dealerships today are under so much pressure to manage expenses,” says Jeff Bennett, who teaches automotive marketing at Northwood University. As dealership service departments increasingly work on hybrid and diesel vehicles as well as gasoline-powered ones, Bennett says parts control becomes more crucial. Partsedge Inc., a supplier in suburban San Diego, offers an inventory management system that monitors parts demand at individual dealerships and dealership groups. The system provides daily, weekly and monthly reports on parts that have been in stock too long, or that were ordered but not used. Partsedge’s Justin Wille: “The part is not sitting there idle.” A dealership “can be using that capital for other purposes.” In addition to stocking parts for multiple powertrains, says Bennett of Northwood University, dealership service departments must prepare for wider use of continuously variable transmissions and automatic transmissions with more than five speeds. Adds Bennett: “That will add a new level of complexity when it comes to inventory management.” c Off the RIM General Motors’ Retail Inventory Management, or RIM, system also is designed to help dealerships stock needed parts and get rid of parts they don’t need. The system works with GM dealerships that handle 97 percent of the company’s parts volume. RIM recommends parts to dealerships based on a nationwide survey of demand, says Bryan Burkhardt, GM’s global director of retail inventory management and distribution planning. But the system also considers individual dealerships’ parts use, he says. To encourage dealers to use RIM, GM pledges to buy back parts the system recommends that do not sell within a year. When GM launched RIM in late 2006, dealers complained that it was too expensive, time-consuming and not tailored to the needs of individual dealerships. Burkhardt says GM has resolved those issues. Use it or lose it “The part is not sitting there idle,” says Justin Wille, Partsedge’s operations manager. A dealership “can be using that capital for other purposes.” Partsedge has about 85 dealership clients, Wille says. Three packages are offered, charging $350, $750 or $1,000 a year. The most expensive system orders parts for a service department, he says. Markley Motors, of Fort Collins, Colo., began using the Partsedge system about 18 months ago, says Terry Brunk, the dealership group’s fixed operations manager. The group consists of two Saturn dealerships whose parts inventories are managed separately, and a Honda store and a Buick-Pontiac-GMC http://www.actionim.com http://www.actionim.com http://www.jcowansprotalk.com http://www.jcowansprotalk.com
Table of Contents Feed for the Digital Edition of Automotive News - August 4, 2008 Automotive News - August 4, 2008 Losing leases: It hurts already Crisis at Chrysler: Buyers bail GM's really bad news: Its revenue Lincoln reworks bonus plan for dealers Pain spreads beyond Detroit: Nissan offers employee buyouts Mitsubishi changes dealer advisory board GM repeats employee discount program Ford merges brands' sales, marketing After 5 funky years, Toyota's Scion now finds itself in a funk It's a body, er, a bus by Fisher At Tech Center, form follows function Industry nemesis again turns up heat on climate Right products, diverse customers raise suppliers' profits Last-minute leases swamp Chrysler With leases off the table, Chrysler offers new sales incentives GM favors 4 endorsed vendors of dealer management systems GKN to supply F-150 FX4's differential For sale: 2 Metaldyne plants 1 week's notice: Chrysler dealers deserved better Get used to the roller coaster That 1934 Reo had a clutch pedal We sell what the public wants Decision makers can't use hindsight Detroit's truck trauma is self-inflicted Why won't consumers buy Detroit cars? Speaking of ads, don't overlook VW Software helps dealers manage parts Service survey: Customer satisfaction rises Researcher: Vehicles can prevent crashes Personnel Microsoft will offer Live Search Dealers Picture This Nissan offers buyouts to its Tenn. workers Lincoln-Mercury exec joins Kia Kaline out at Ford Penske earnings drop slightly Asbury will move; profits slip S&P downgrades American Axle Best sales news: July is over Now THAT'S resale value ... Sirius-XM satellite radio deal: A mixed bag Don't be misled by Chery's sales; it's a key player McCurdy applies some political (tire) pressure A star is born: The saga of the shrinking sticker Our flag is still there Obama-mobile? Or McCain-carrier? Automotive News - August 4, 2008 Automotive News - August 4, 2008 - (Page Intro) Automotive News - August 4, 2008 - GM's really bad news: Its revenue (Page 1) Automotive News - August 4, 2008 - GM's really bad news: Its revenue (Page 2) Automotive News - August 4, 2008 - Ford merges brands' sales, marketing (Page 3) Automotive News - August 4, 2008 - After 5 funky years, Toyota's Scion now finds itself in a funk (Page 4) Automotive News - August 4, 2008 - After 5 funky years, Toyota's Scion now finds itself in a funk (Page 5) Automotive News - August 4, 2008 - Right products, diverse customers raise suppliers' profits (Page 6) Automotive News - August 4, 2008 - Right products, diverse customers raise suppliers' profits (Page 7) Automotive News - August 4, 2008 - With leases off the table, Chrysler offers new sales incentives (Page 8) Automotive News - August 4, 2008 - With leases off the table, Chrysler offers new sales incentives (Page 9) Automotive News - August 4, 2008 - For sale: 2 Metaldyne plants (Page 10) Automotive News - August 4, 2008 - For sale: 2 Metaldyne plants (Page 11) Automotive News - August 4, 2008 - Decision makers can't use hindsight (Page 12) Automotive News - August 4, 2008 - Decision makers can't use hindsight (Page 13) Automotive News - August 4, 2008 - Speaking of ads, don't overlook VW (Page 14) Automotive News - August 4, 2008 - Service survey: Customer satisfaction rises (Page 15) Automotive News - August 4, 2008 - Personnel (Page 16) Automotive News - August 4, 2008 - Dealers (Page 17) Automotive News - August 4, 2008 - Dealers (Page 18) Automotive News - August 4, 2008 - Picture This (Page 19) Automotive News - August 4, 2008 - Picture This (Page 20) Automotive News - August 4, 2008 - Picture This (Page 21) Automotive News - August 4, 2008 - Picture This (Page 22) Automotive News - August 4, 2008 - Picture This (Page 23) Automotive News - August 4, 2008 - Nissan offers buyouts to its Tenn. workers (Page 24) Automotive News - August 4, 2008 - S&P downgrades American Axle (Page 25) Automotive News - August 4, 2008 - S&P downgrades American Axle (Page 26) Automotive News - August 4, 2008 - Best sales news: July is over (Page 27) Automotive News - August 4, 2008 - Best sales news: July is over (Page 28) Automotive News - August 4, 2008 - Best sales news: July is over (Page 29) Automotive News - August 4, 2008 - Obama-mobile? Or McCain-carrier? (Page 30) Automotive News - August 4, 2008 - Obama-mobile? Or McCain-carrier? (Page 31) Automotive News - August 4, 2008 - Obama-mobile? Or McCain-carrier? (Page 32)
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