FADA releases CDD report 2023

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.

New Delhi- The Federation of Automobile Dealers Associations (FADA)., India's premier organization for automobile retail, today unveiled the results of its comprehensive Dealer Satisfaction Study 2023. Conducted in collaboration with Singapore-based PremonAsia, a leader in consumer insights and advisory services, the study offers an unparalleled look into the auto retail landscape.

Distinctive Achievements in Dealer Satisfaction Across Segments While the leaders in the Two-Wheeler Mass Market and Commercial Vehicle (CV) segment maintain their positions from the previous year, the Four-Wheeler Mass Market segment has seen intriguing shifts. Hyundai now spearheads the category, followed by notable entrants Maruti-Suzuki and Mahindra & Mahindra in the top three.

Exceptional Performers Deserve Recognition:

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.

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.

Industry-Wide Insights on Dealer Satisfaction and Emerging Trends

At the aggregate industry level, the Average Dealer Satisfaction Score has marked an encouraging increase, rising by 48 points YoY to a current score of 767. Notably, 'Product' stands out as the highestscoring factor across all categories. This trend underscores the industry's commitment to meeting contemporary consumer demands with world-class products.

Despite its notable improvement from the previous year, the 'Business and Viability' criterion remains the lowest-scoring factor, signalling a critical area for ongoing attention and development.

Segment-Specific Observations:

Commercial Vehicle segment: 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.

FADA President, Mr. Manish Raj Singhania said, “The YoY improvements underscore the indispensable value of this annual study in identifying critical issues to fortify the Auto OEM-Dealer partnership. 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 MBOs (Multi-Brand Outlets) offer ample scope for improvement.”

FADA Treasurer and Director DSS’23, Mr Amar Jatin Sheth added, “In its third edition, DSS’23 has grown more robust, drawing participation from over 1,800 Dealer Principals and approximately 3,500 outlets, representing a balanced mix from all four geographical zones in India. The study utilizes six evaluative dimensions and 70 attributes to arrive at its findings. While dealer satisfaction is generally improving, aspects like dealer involvement in OEM policy-making remain areas for potential progress.”

PremonAsia Director and COO, Mr Rahul Sharma remarked, “The 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.”