Q2 2021

Dealers indicate positive relationship with manufacturers

In this section, the NFDA provides an overview of the franchised dealer landscape and the latest Dealer Attitude Survey results.

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Sue Robinson, Chief Executive of the National Franchised Dealers Association.

Following the huge challenges faced by our sector over the past months, we can finally look forward to welcoming customers back into showrooms. Over the past months, dealers have proved their resilience and although online sales have provided a new strategic lifeline for businesses, consumers still want to visit dealerships. 

NFDA dealer sentiment

Monitoring the business relationship between dealers and manufacturers is key, especially when we go through challenging times.

We have recently published the latest edition of our NFDA Dealer Attitude Survey*, which is vitally important to gauge the health of the relationship between dealers and manufacturers and highlight any potential issues. With the challenges facing our sector over the past months, it is extremely encouraging that nearly 60% of UK dealers completed the survey.

Positively, the majority of dealers are satisfied with the support they received from their manufacturers during the pandemic as well as their ability to do business with respective OEMs on a day-to-day basis.

Despite the overall marginal average increase in score, areas remain where several dealer networks have expressed a degree of dissatisfaction - in particular around new car targeting, profit return and return on investment.

“Positively, the majority of dealers are satisfied with the support they received from their manufacturers during the pandemic as well as their ability to do business with respective OEMs on a day-to-day basis.”

Sue Robinson, Chief Executive of the National Franchised Dealers Association (NFDA)

Survey summary

Manufacturer support during Covid-19

Average levels of dealer satisfaction with the support received through the pandemic by respective manufacturers remained relatively high at 6.4 points out of 10. Lexus (9.4), Kia (9.3) and Toyota (8.8) received the highest ratings in this section. Thanks to an increase of 2.2 points from the summer edition of the survey, Volkswagen saw the largest improvement.

Manufacturer support during Covid-19

Source: NFDA

Overall average score

At 9.1 points, Lexus had the highest average score across all questions for the fourth consecutive edition of the survey. Kia followed in second place (8.7) and Mercedes (8.5) closed the top three thanks to a 1.0-point jump from six months ago. Jeep (3.0), Fiat (2.9) and Alfa Romeo (2.6) sat at the bottom of the table. The average score for this question (6.0) was up by 0.1 points from six months ago.

Overall average score

Source: NFDA

*NFDA carries out the Dealer Attitude Survey twice a year. The survey has taken place continuously since 1989. With a total of 2,585 responses from 32 participating dealer networks, this edition of the survey received a response rate of 59.5%.

Transition to EVs

The recently announced decision to cut the Plug-in Car Grant and Van & Truck Grant is extremely disappointing as it risks undermining the progress the UK has been making towards a zero-emission market in line with the 2030/2035 deadline set by the Government.

Following the announcement, we have written to the Transport Secretary Rt Hon Grant Shapps MP to express our surprise and disappointment at these sudden changes at such a critical time.

The cost of the electric cars currently available on the market remain higher than their petrol or diesel counterparts and it is vital that buyers continue to be incentivised.

The NFDA has repeatedly highlighted that we must avoid a situation where the least well-off drivers are deterred from buying a new, low-emission vehicle when the time comes to replace their old one.

Sales of electrified vehicles have been performing well but they still represent a relatively small proportion of the overall market; the timing of the cut to the grant is unfortunate as a number of private customers ave been waiting for showrooms to reopen to get familiar with new types of vehicles, including EVs.

Dealers play a crucial role during this transition and we continue to develop our Electric Vehicle Approved (EVA)accreditation scheme to set industry standards in EV retail and aftersales and give consumers the reassurance they often need when buying an electric car.

Policy

We liaise with the relevant Government departments reguarly and continue to work closely with dealers to set strategy and deal with a number of issues across various industry areas including HR, F&I, used cars, IT, and aftersales. We have also recently set up a new ‘Better Regulations’ working group which allows us to look at the motor vehicle Block Exemption Regulations as they come up for renewal.

NFDA is the trade association representing franchised car and commercial vehicle retailers in the UK, NFDA is the voice of automotive retailers. For more information, please visit www.nfda-uk.co.uk or email nfda@rmif.co.uk