Aside from all of the design and engineering that goes into new model vehicles, the planning necessary to stock and manage service-parts inventory for these cars is a major component of a successful launch. This is pretty critical to the new vehicle customer experience. And if we want them to buy another new car down the road, we have to get this right. Think about the situation described earlier: this customer may turn to an independent service provider and be lost to the dealer from the get-go. Plus, we know that such a poor initial experience will likely push the customer to another brand entirely the next time they go car shopping.
We recently conducted a benchmark study with a group of automotive and heavy equipment subject matter experts to investigate how new model parts are managed and stocked, and the impact or performance of those strategies on fill rates. “New model part” typically means any new part on a new or redesigned vehicle (a few heavy equipment OEMs also include carryover parts on new vehicles in this bucket).
While there was little consensus on how to best manage new model parts and how to accurately forecast these parts, a few potential best practices emerged.
- Some OEMs stock just a couple of months of supply for all new parts, while others stock up to 12 months of supply on a fairly limited selection of parts. In general, the standard is to keep months of supply low. Defining critical parts within new model is key so that stocking breadth can be more targeted.
- New model part fill rates and targets vary fairly widely, both in measure and in practice. Some OEMs measure fill rates at the time of vehicle sales, others one month out, and others up to six months out. Measuring new model fill at the time of vehicle sales will better measure and mirror the actual customer experience.
- Very few OEMs, if any, are currently tracking or tying customer satisfaction to new model part fill rates and strategies, despite the risk that problems with a new part could ruin a customer’s experience with a vehicle. Happiness with that new car will help drive your customer back to the dealer for service and to the OEM when it’s time to buy another car.