Friday, March 14, 2014

2014 NASB Trends – Looking Back to See How Far We’ve Come

By Charlotte Williamson

The North America Service Benchmark (NASB) got its start back in 2008 when 11 automotive brands (with only two luxury brands) met for a one-day conference in Dallas. Today, NASB has grown to 17 automotive brands, with seven luxury brands, and two face-to-face meetings a year. With the Spring NASB Meeting (on Service Capacity Management and Express Service) coming up fast, we thought we’d review the last five years of data.

The main objective we set for this benchmarking back in 2008 was to provide action-oriented metrics and insights into leading industry practices, in order for companies to use the data to learn and improve. As 2008 was in the middle of a large and steep decline in industry sales, brought upon by the “great recession”, we basically started benchmarking this data at the bottom, in a very challenging marketplace, and have been digging ourselves out ever since.

So how are we doing? The news, we’re happy to announce, is great. Our research found that several key metrics have improved substantially for OEMs that participated in all five years (in aggregate), since 2010 NASB.
  • The percent of 1 to 7 year old units-in-operation (UIO) with at least one customer pay visit increased 27%.
  • The percent of 1 to 20 year old units-in-operation (UIO) with at least one customer pay visit increased 49%.
  • The customer pay sales per 1 to 7 year old UIO increased 21%, despite a 5% decrease in sales per 1 to 7 year old retained UIO.
  • Sales per repair order are steady.
  • Most brands saw increases in customer pay and warranty customer satisfaction.
  • Almost all brands saw a significant decrease in the internal measurement of the percent of vehicles that were not fixed right the first time.

Coming out of the recession, we have fewer vehicles on the road in the core 1 to 7 year range, but have reduced our dealer bodies and adjusted service capacity to accommodate them. Customers are more satisfied and our quality of work is increasing. Vehicle sales are quickly approaching 16 million again and, at least at a national aggregate level, it appears our dealers have the capacity to accommodate them.

Bottom Line: Nationwide, we seem to be doing fine on capacity. But what about individual markets and brands? We know customers don’t like to travel for service if they can avoid it. Do we have the right capacity in the right places? What about our sales growth objectives? Can we meet the service needs of our new customers? How will the current trend in vehicle sales affect our ability to take care of these customers? We’ll explore these questions and more at the Spring meeting session on Service Capacity Management.

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