India’s four-wheeler mass market segment is seeing intriguing shifts with Hyundai now spearheading the category, followed by notable entrants Maruti-Suzuki and Mahindra & Mahindra in the top three while in the two-wheeler mass market, with an industry-level improvement of 84 points, Royal Enfield has boosted its score by 96 points to secure the runner-up position, as per the results of a Dealer Satisfaction Study 2023 by the Federation of Automobile Dealers Associations (FADA).
The survey, conducted in collaboration with Singapore-based PremonAsia, a leader in consumer insights and advisory services, offers deep insight into the auto retail landscape with the YoY improvements highlighting the value of the study in identifying critical issues to fortify the auto OEM-dealer partnership. In its third edition, the survey has drawn participation from over 1,800 dealer principals and approximately 3,500 outlets, representing a balanced mix from all four geographical zones in India.
While auto dealers are increasingly optimistic, concerns related to dealership viability and policy collaboration with OEMs require immediate attention. Going forward, high-impact areas such as unsold inventory clearance and actions against multi-brand outlets offer ample scope for improvement. According to PremonAsia Director and COO, Rahul Sharma, dealers continue to assign higher importance to after-sales and business viability related issues.
While there have been improvements made by OEMs in all the areas, the expectations on ensuring dealer viability, particularly related to OEMs buyback / deadstock inventory and understanding the dealer cost structure are still flagged as concern areas across the industry. Addressing these concerns through involving dealers in the policy making and hearing them will certainly go a long way in managing dealer expectations better.”
Demonstrating the most significant leap in this year’s study, Honda Cars India escalated its ranking by 153 points, settling at the fourth position in the four-wheeler passenger mass segment. While dealers express high satisfaction with product reliability, concerns persist regarding deadstock and inventory buyback policies, as well as the extent of dealer involvement in policy-making decisions with OEMs.
In commercial vehicles, while VECV continues to occupy the pole position, Tata Motors and Ashok Leyland have significantly narrowed the gap, improving their scores by 68 and 67 points, respectively. This sets the stage for an intensely competitive landscape in the forthcoming years. The study highlights an increased level of satisfaction, particularly in business viability. This is significant, given the industry’s recent transition to BS VI compliant vehicles. However, concerns remain about deadstock management and OEM inventory buyback policies.
On brand dynamics, Hyundai has surpassed Kia in rankings, attaining the leadership position. Honda emerges as a standout performer, notably benefiting from its new product launches and unwavering dealer support, particularly in areas concerning business and viability. Similar to their counterparts in other segments, two-wheeler dealers are generally satisfied with product reliability and range. Yet, concerns about OEM buyback and deadstock policies, along with decision-making involvement, remain. Among the opportunities for enhancement emphasised by the survey, is inventory management underlined by a consensus on the need for more supportive measures in inventory and carrying-cost management. On dealer involvement, the survey brings out the need for active dealer advisory councils which can play a pivotal role in driving dealer satisfaction, particularly by involving them more closely in decision-making processes.