The Hindu Business Line : Domestic auto companies pip MNCs in dealer satisfaction rankings

Customer satisfaction rankings involving automobile companies are often a reflection of their size and stature in the industry, in terms of sales volumes. However, the same sales numbers of these automobile companies seem to be only one small determinant when measuring the satisfaction levels among their dealers. There are other intangible factors, including the dynamism of the automobile company, the possibility of future growth prospects and the quality of communication that seem to affect dealer satisfaction levels.

According to the findings of a Dealer Satisfaction Study, released by leading market information provider TNS Automotive, the dealers of Mahindra and Mahindra (M&M) are the most satisfied amongst all passenger cars and utility vehicle (UV) dealers in the four-wheeler category and Bajaj tops the list in the two-wheeler category.

The Dealer Satisfaction Study (DSS), conducted by TNS's specialist division TNS Automotive, is a periodic survey covering the dealers of all major four- and two-wheeler companies in India. The current study covered more than 900 automotive dealers and is all but their voice. Responses pertain to the key areas of product performance, sales and marketing, after sales and overall manufacturer relationships with dealers.

Domestic auto-makers' progress

For the first time since 2002, when TNS Automotive started measuring Dealer Satisfaction in India, home-grown companies have displaced multinationals from the top. This is a reflection of progress made by Indian manufacturers in developing a strategy to keep their dealers motivated.

Interestingly, while M&M ranks on top, all the three major passenger car manufacturers — Maruti Udyog, Hyundai Motor India and Tata Motors — are ranked much lower at sixth, seventh and ninth positions respectively with index values that are lower than the industry average. However, relatively smaller passenger car manufacturers (in terms of sales volumes), such as Honda Siel Cars and Skoda Auto India, are ranked above the big three.

Similarly, in the two-wheeler space, while dealers of Bajaj Auto have voted it to the top of the list, the market leader, Hero Honda, has been pushed to the second slot. TVS Motor Company, the country's third biggest two-wheeler maker in terms of volumes, has been pushed to the fifth rank in the DSS. Honda Motorcycle and Scooter India (HMSI) and newcomer Suzuki Motorcycle India have been ranked third and fourth respectively.

Reversing trend

The study reveals that, overall four-wheeler dealers are more satisfied than the two-wheeler dealers. However the equation reverses in case of dealers based in the Metros. This pattern is common with the satisfaction on profitability. The industry scores for the two-wheeler and the four-wheeler dealers are 73 and 81 respectively. This implies that at an overall level, the manufacturers are meeting the dealer fraternity's expectations.

According to TNS Automotive, "Dealer sentiment is a strong endorsement of the manufacturer's strategy and reflects their confidence in future prospects. Since all manufacturers realise that automotive dealers are an interface between them and their customers, the study bears a high level of relevance and interest among these companies."

Top-ranking automobile companies have performed well on measures of product and processes. Four-wheeler dealers treat latest technology and high quality products from their manufacturers as a given. A case in point is Honda Siel Cars. The key differentiating feature of all Honda models sold in India is their latest technology and quality of products, which their dealers have accepted as a norm. Further improvement on these aspects may not alter these dealers' satisfaction significantly.

Dealers' concerns

Dealers of passenger vehicles feel that manufacturers are not concerned about their profitability and there are some sore areas such as order and delivery delays, sales and marketing support, relationship with the sales staff, etc. Two-wheeler dealers have shown concern towards fairness of franchisee terms, fairness of reward and recognition and implementation of dealer suggestions.

According to the TNS study, the enhanced satisfaction of Mahindra dealerships is also driven by the recent new alliances that are propelling the company in the league of passenger car business. This is a total shift for the organization from its traditional image of utility vehicle maker. Similarly for Bajaj, the sheer performance of all the recently launched models has spurred a buoyant mood amongst its dealers.

The areas where Mahindra dealers are happier compared to four-wheeler dealers at large pertain to `Timely Delivery', `Fairness of contribution in joint advertising', `Implementation of dealer suggestions by dealer staff', `empowerment' and `fairness of dealer rewards'.

Areas where Bajaj stands out compared to the industry are `fairness of contribution in advertising', `openness to dealer suggestions', `understanding of the competitive scenario' and `willingness to resolve dealer grievances'. It also stands out on `concern for dealer profitability' where market leader Hero Honda is seen as being weak.

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