Automobile Dealers Frustrated Despite Record Sales Year
10 December 1999
J.D. Power and Associates Reports: Automobile Dealers Frustrated Despite Record Sales Year
Lexus Tops the Dealer Satisfaction Index
AGOURA HILLS, Calif., Dec. 9 -- Despite a record sales year
in the automotive industry, the nation's vehicle retailers are increasingly
frustrated with manufacturers, according to the J.D. Power and Associates 1999
Dealer Attitude Study(SM) released today. The Dealer Satisfaction Index,
which measures how satisfied dealers are with their manufacturers, dropped
three points in 1999 -- the largest single-year drop since the automotive
industry recession in 1989.
The overall reduction in the index was primarily due to declines in
satisfaction among General Motors and Ford Motor Company dealers.
"Dealers increasingly perceive that manufacturers are intruding into their
domain," said Chris Denove, consulting operations director at J.D. Power and
Associates. "More than one-half of all dealers believe that manufacturers
would like to eliminate dealers altogether in favor of a system of factory-
direct sales. Other dealer complaints ranged from perceived unfairness in
vehicle allocation to concerns that manufacturers unfairly shift distribution
costs onto dealers."
The study also uncovered a number of bright spots. Not all dealers are
less satisfied. Dealer satisfaction showed an increase for 17 of 31
nameplates evaluated, and only 5 percent of dealers believe there will be any
fundamental restructuring of the franchise system over the next five years.
"For the most part, dealers see themselves as survivors who are up to the
challenges posed by manufacturers and the Internet," Denove said.
For the second straight year, Lexus tops the Dealer Satisfaction Index
with a score of 160. Lexus' first-place ranking results from a combination of
strong dealer relations and hot-selling products. Seventy-nine percent of
Lexus dealers rate their manufacturer relationship as excellent. Saturn
retains its second-place ranking with a score of 139, despite dropping four
points in this year's study.
The five nameplates showing the biggest increase in their Dealer
Satisfaction Index scores include: Suzuki (30 points); Nissan (22 points); Kia
(15 points); Saab (15 points); and Hyundai (14 points).
The 1999 Dealer Attitude Study is based on responses from more than 3,000
dealer principals-nearly one-quarter of all new-car dealership management
organizations in the United States. The study is independently funded by J.D.
Power and Associates.
Headquartered in Agoura Hills, Calif., J.D. Power and Associates is a
global marketing information services firm operating in key business sectors
including market research, forecasting and customer satisfaction. The firm's
quality and satisfaction measurements are based on actual customer responses
from more than one million consumers annually.
J.D. Power and Associates can be accessed through the World Wide Web at
http://www.jdpower.com. Media e-mail contact: matthew.scroggs@jdpower.com. This
press release is provided for editorial use only.
No advertising or other promotional use can be made of the information in
this release or J.D. Power and Associates survey results without the express
prior written consent of J.D. Power and Associates.
J.D. Power and Associates
1999 Dealer Attitude Study(SM)
Top 10 DSI Nameplate Scores
(0 - 175)
Rank
1 Lexus 160
2 Saturn 139
3 Jaguar 137
4 Honda 127
4 Kia 127
4 Toyota 127
7 Porsche 126
8 Audi 125
9 Hyundai 122
10 Suzuki 120
Industry 90
Source: J.D. Power and Associates 1999 Dealer Attitude Study(SM)
Charts and graphs extracted from this press release must be accompanied by
a statement identifying J.D. Power and Associates as the publisher, and the
J.D. Power and Associates 1999 Dealer Attitude Study(SM) as the source. No
advertising or other promotional use can be made of the information in this
release or J.D. Power and Associates survey results without the express
written consent of J.D. Power and Associates.