NFDA Dealer Attitude Survey reveals relationships are straining

The NFDA Dealer Attitude Survey was conducted in September 2023 and asked franchised dealers questions about the on-going business relationship with their respective manufacturers. The survey attracted 2,531 responses from 32 franchised networks, equating to a joint record response rate of 68 per cent. The survey showed a general downward trend across most questions with 47 out of 55 questions showing a decline versus the winter edition. The results were published on Monday 9 October 2023.

“NFDA’s Dealer Attitude Survey is a comprehensive analysis that delves into the perspectives, insights, and sentiments of the working relationship between franchised dealerships and their respective manufacturers across the UK. This is a landmark edition as we have welcomed our new data-analyst partners, Metryx, to reshape and redesign how the sector can interact and dissect the data, offering a fresh new look for easy access and analysis,” said Sue Robinson, chief executive of the National Franchised Dealers Association (NFDA) which represents franchised car and commercial retailers across the UK.

Profit Return

Dealer satisfaction levels for profit returns has fallen on average from six months prior, from 6.7 in Winter 2022 edition, to 6.2 in the current Summer 2023 edition equating to a -7.5 per cent change. The highest returning scores came from Kia (9.1), BMW (8.3) and MINI (8.2). The lowest returning scores from Vauxhall (2.4), Citroen (2.2) and DS (1.2).

Electric Vehicles

The survey revealed that franchised dealer sentiment around EVs is being weighed down by the high levels of investment required for the transition, in comparison to the lack of manufacturer support. In particular, dealers have raised concerns with their manufacturer’s support for on-site EV charging infrastructure, returning an average of 4.9 out of 10, the lowest returning score for the entire survey.

Used cars

The highest returning scores from the survey revolve around used car satisfaction. Dealers were most satisfied with their respective manufacturers’ used car standards, returning the highest average score of 7.1 out of 10. This was followed by total margins made from used cars, returning an average of 7 out of 10. Lexus (9), Kia (8.9) and Suzuki (8.4) were the front runners, followed by Citroen (4.4), Jeep (4.4) and DS (3.9).

Most Improved

Although returning a particularly low score, it is positive to see that new car supply is steadily improving in the UK. When asked how satisfied dealers were with their manufacturer’s new vehicle supply, the Summer 2023 returned an average of 5.5 out of 10, 0.5 points higher than Winter 2022 edition which equates to a 10% change. Lexus (7.7), Nissan (7.6) and Kia (7.5) were most satisfied and DS (3), Ford (2.8) and Jaguar (2.6) were least satisfied.

Agency

Manufacturer’s approaches to future retailing agreements and contracts has fallen on average by – 0.3, from 6.3 in the Winter 2022 edition to 6 in the Summer 2023 edition. Lexus has returned the highest score of 9.2, followed by Kia (9.1) and Suzuki (8.6). The lowest returning scores came from Vauxhall (2.6), Citroen (2.4) and DS (1.0).

Overall

The all-important question ‘how would you rate your manufacturer overall on a scale of 1 to 10?’ returned an average of 6.3, a 0.2 fall from our Winter 2022 edition. Kia (9.5), Lexus (9.2), and MINI (9.0) were the top performers whilst Vauxhall (2.4), Jeep (2.3), and DS (1.5) received the lowest ratings. Audi improved the most with a 26 per cent increase in rating from the previous survey.

Following Kia’s success as the manufacturer with the highest returning score for the Summer 2023 Dealer Attitude Survey, Paul Philpott, president and CEO of Kia UK Limited, commented: “We are truly delighted to again be named the overall winner in the NFDA Dealer Attitude Survey. This Survey offers us a fantastic insight into our dealer partnership, which forms the backbone of our business. This year has been full of unique challenges, which I’m proud to say we have been able to work together to overcome. Alongside our customers, our dealer partners are at the forefront of Kia and together we work hard to make it the brand it is today: a leader in electrification; the fourth best-selling brand in the UK; and on the way to launching seven EVs in the UK by 2027.

“Whilst this is a time of celebration for us and our partners, there is no time to rest on our laurels. We will continue to navigate new and evolving challenges, deliver on the needs of our customers and the transition to electric vehicles. We are proud of our strong network partnership and are well placed to build on our excellent foundations, adapt to change and deliver world class mobility solutions. “

Sue Robinson concluded: “It is extremely positive to see the NFDA Dealer Attitude Survey has once again returned the record response rate, demonstrating the automotive industry’s unwavering commitment to sharing its valuable insights and attitudes that are shaping the retailing sector.

“The DAS is an extremely valuable and constructive tool for both manufacturers and dealers. It enables many to better understand the areas that are damaging the relationships with their respective dealers. It is particularly disappointing to see Stellantis brands again receiving the lowest scores across the board, a clear indication of a challenged business relationship and highlights a pressing need for improved collaboration and support to better align with dealer expectations and foster a mutually beneficial business operation.

“With the dynamic landscape of the automotive industry constantly evolving, it is now more important than ever to listen to the attitudes of dealers, serving as the compass that guides us towards a future sector of innovation, collaboration, and mutual success.”