Contents. Table of Contents. Background...1. Survey Results...2. Report Structure...2. Communication & Relationships...3. Used Cars...

Transcription

1 NATIONAL AUTOMOBILE DEALERS ASSOCIATION Dealer Satisfaction Survey 009 Passenger Report August 009

2 Contents Table of Contents Background...1 Survey Results... Report Structure... Communication & Relationships...3 Used Cars...4 CSI Program...4 Vehicle Range...4 Franchise Agreements...5 Franchise Compliance Audits...5 Vehicle Distribution...5 Media Support...6 Parts...7 Warranty & Goodwill...8 Dealer Support Financial...8 Dealer Support Training...8 Dealer Support Regional/Area Managers...10 Dealer, Customer and Investor Friendly? Dealer Friendly Questions & Weightings...10 Customer Friendly Questions & Weightings...1 Investor Friendly Questions & Weightings...13 Overall Performance Overall...14

3 Confidential DSi 009 National Automobile Dealers Association NADA Dealer Satisfaction Survey 009 Background The National Automobile Dealers Association (NADA) in South Africa has for a number of years, measured dealers satisfaction with the various Manufacturers and Importers. The process began in 1996 and has grown year by year ultimately including a total of 41 brands in 009. In 009 the survey process mainly followed the structure used in 008. The following points are worth mentioning: All dealer principals had the opportunity to take part and provide input. The data collection method included , fax and telephonic surveys. The variety of options available to dealer principals was seen as instrumental in the improved response rate compared to the 008 survey. Dealers were encouraged to consult with their dealer management teams on the questions and as a result answers are well considered responses. The questions posed were shorter and to the point with more direct / answers providing direct results. The 009 survey attempted to include questions relevant to the current economic climate experienced in the South African automotive industry. The 009 survey leveraged assistance from the majority of dealer council chairmen. The 009 survey received results from more than 1000 Southern African dealer principals. The participating Passenger / Light Commercial Vehicle (LCV) brands were: Audi Chrysler/Jeep/Dodge Citroen Daihatsu Ford/Mazda General Motors Honda Hyundai Jaguar Kia Land Rover Lexus th Mahindra Mercedes Benz Mini Mitsubishi Nissan Peugeot Renault SsangYong Subaru Tata Toyota Volkswagen Volvo w in its 14 year the results are eagerly anticipated each year by the entire industry and are brought into sharp focus by a gala award ceremony that takes place in August. This report serves to communicate the results of the passenger/lcv survey conducted. KA SMART Management Consultants (Pty) Ltd (KA SMART) have been involved with the survey since inception and have guided the evolution of the project. Page 1 of 14

4 Confidential DSi 009 Survey Results following question was asked: How satisfied are you with your Manufacturer/Importer? This question is asked using a ten point rating scale with one being extremely dissatisfied and 10 being extremely satisfied. The results are calculated using the average score per brand: Report Structure The survey results are divided into a number of key focus areas areas of interest to the NADA membership at large. These focus areas are: Dealer Satisfaction & Loyalty; Communication & Relationships; Used Cars; CSI Program; Vehicle Range; Franchise Agreements; Vehicle Distribution; Parts; Warranty & Goodwill; Franchise Compliance Audits; Media Support; Dealer Support Training; and Dealer Support Development. Figure 1 How satisfied are you with your Manufacturer/Importer? 100.0% Customer Friendliness; and Investor Friendliness. 64.0% 6.1% 61.9% MINI Nissan 6.4% National Average, 71.5% 60.0% 55.9% 64.3% 64.% Mitsubishi TATA Mahindra 66.4% 65.3% Citroen 67.9% 67.1% Volvo Subaru 71.5% 69.8% 7.5% 7.1% 74.1% 73.8% 74.5% 74.4% 75.0% 74.5% 80.0% 76.4% 81.1% 80.6% % 50.0% 40.0% 30.0% 0.0% 10.0% Peugeot Honda Land Rover Ford Mazda GMSA Jaguar Toyota Volkswagen Renault Mercedes Benz Lexus Daihatsu SsangYong Chrysler Jeep Dodge Audi Hyundai 0.0% Following this probe dealer principals where asked: If you were approached by a friend who was interested in buying/purchasing a dealership, how likely are you to provide positive referrals for your current franchise? In consultation with the NADA executive all questions within each of the focus areas were categorised into three broad groups: Dealer Friendliness; 8.% 80.0% This report deals with each of these focus areas separately. 8.4% % This forms a key theme throughout this report and is used to score Manufacturers/Importers as to their perceived Dealer, Customer or Investor Friendliness. Dealer Satisfaction & Loyalty Two questions are rated in this section. The first question measures the Dealer Principal s satisfaction with the Brand. The Frederick Reichheld s Net-promoter 1 analysis is based on a similar question and it provides an excellent basis for calculating loyalty. The question s output enables the calculation of a net-promoter score, which is the ratio of promoters to detractors. Based on their responses on the 1 to 10 rating scale, dealer principals were grouped into promoters (9 10 rating extremely likely to recommend), passively satisfied (7 8 rating), and detractors (1 6 rating extremely unlikely to recommend). By subtracting the percentage of detractors from the percentage of promoters a netpromoter score is arrived at. Figure below highlights these results: Page of 14 1 Frederick Reichheld is a director emeritus of the consulting firm Bain & Company and a Bain Fellow. Author of Loyalty Rules! (Harvard Business School Press, 001)

5 Confidential DSi 009 Net Promoters Analysis Figure shows the percentage net promoters as well as the relative spread of promoters and detractors for each of the Manufacturers and Importers. Figure Net Promotor Analysis Toyota % Hyundai questions focused on the tone of the relationship between the dealership and the Manufacturer/Importer; note the emphasised wording: 1. Communicates openly and honestly;. Committed to win/win solutions; 3. Leaders to behave with fairness and integrity; and 4. Values people and relationships ahead of short-term profits % Audi % Mercedes Benz % % Land Rover % Volkswagen The average of these four questions, in combination provides a useful indicator of the state of the relationship between Manufacturer/Importer and dealer network % Lexus + 5.0% % Honda % Figure 3 Communication & Relationships % Chrysler Jeep Dodge % Renault Jaguar 81. Renault 80.7 Audi 79.7 Hyundai % Mahindra + 0.0% 75.7 Jaguar + 0.0% 74.9 SsangYong % Daihatsu Subaru Chrysler Jeep Dodge % GMSA Nissan 88.7 Ford Mazda SsangYong Volvo GMSA % 73.1 Lexus 7.6 Toyota 71.9 Daihatsu % - 1.4% - 3.4% 70.9 Mercedes Benz Mitsubishi - 5.0% 70.3 Volkswagen 69.7 Ford Mazda TATA Citroen Volvo % 68.7 Land Rover 68. Subaru % % 65.4 Citroen MINI % 65.3 Mitsubishi Peugeot % 65. TATA Peugeot 63.8 MINI 6. Nissan Average, 71.1 The global benchmark for this analysis established over many thousands of surveys across all industry types is 16%. 6.9 Mahindra 008 Communication & Relationships 0 A key focus of the survey each year is to foster and improve communication and dialogue between the Manufacturers/ Importers and the dealers. 8 questions covered a number of aspects around communication and relationships. 4 of these Honda There are strong indications that current relationships between Manufacturer/Importer and dealers of the following Brands is under strain: Page 3 of 14 Honda;

6 Confidential DSi 009 ; Mahindra; Nissan; Mini; Peugeot; dealers are satisfied and in the case of Chrysler/Jeep/Dodge, Mercedes Benz, Mini and Mitsubishi the dealers were unanimous that the allocation and distribution system is fair. In the case of Toyota, Mahindra, Honda and Peugeot more dealers believe the system to be unfair than believe it to be fair. Tata; CSI Program Misubishi; Citroen; Subaru; Land Rover; Ford/ Mazda; Customer Satisfaction Indices (CSI) is easily the most negatively viewed of all Manufacturer/Importer programs the trend continued in 009. Overall more than 40% of the dealer principals believe that CSI programs are ineffective as a management tool. Volswagen; and Figure 4 Factors Influenced by CSI Levels 180 Mercedes Benz vehicle supply 8.3% vehicle quality % parts supply 140 Used Cars 17.3% 10 Manufacturer/Importer branded used car programs where they exist were probed too. Average scores here ranged between 60% and 75%. 16.% 13.4% Effectiveness Program of Branded Used Car Best performers on this aspect are Toyota and Nissan. The 009 question asked dealer principals to evaluate whether a branded used car programme contributed to increasing gross profits and volumes compared to an individually owned non branded programme. As shown in figure 4 a significant number of dealers feel that their Customer Satisfaction levels are negatively affected by Parts supply, Vehicle supply and Vehicle Quality problems this is indicated by the large % of scores of seven and above. Maintaining Good Used Car Values for Brand Vehicle Range Here the top performers are Nissan and Audi. The poorest results in maintaining good used car values for the Brand were recorded by Mitsubishi and Peugeot. Used Vehicle Allocation System Dealer Principals were asked if they felt that the used vehicle allocation and distribution system for fleet and demo vehicles used by their Manufacturer/Importer is fair. Generally Dealers were asked Does the range of vehicles available allow you to compete adequately in the market? And if not What do you believe is missing from the range? The results of the latter question are informative: Toyota dealers, for the third year running, want a ½ ton pick-up, as well as a cheaper entry level vehicle; Volkswagen (bakkie); Page 4 of 14 dealers want a LCV

7 Confidential DSi 009 Audi dealers want an entry level A3; General Motors dealers would like the option of a medium sedan; Renault dealers would like a LCV range; Peugeot dealers want a premium range vehicle; Ford/Mazda dealers would like a cheaper entry level vehicle and indicated a liking in a smaller SUV option; and Mitsubishi dealers are looking forward to a single cab option. Figure 5 show the percentage of dealers, by make, that believe that the vehicle range available to them allows them to compete adaquately: Figure 5 Adaquate Vehicle Range Land Rover Mercedes Benz improvement in overall scores received for this section. There were five issues discussed in this section of the survey. On a national scale the results are as follows: 63.5% believe that the investment they have to make in premises to comply with the Manufacturers/Importers corporate identity requirements is reasonable notably however this varies considerably by brand; More than 80% of dealer principals feel that their franchise agreement allows sufficient commercial independence in running their businesses; More than 70% of dealers believe that the cancellation clause provided for in their franchise agreement is fair. 71.7% believe that in the event of cancellation the notice period provided for is fair and reasonable; and Significantly however more than half of dealers feel that the compensation provided for in situations where through no fault of the dealership, a dealership is cancelled is inadequate Hyundai 86.7 Audi 85.7 Chrysler Jeep Dodge 85.7 Franchise Compliance Audits 83.3 Renault 80.8 MINI 78.6 Volvo 78.6 TATA The questions posed were regarding relevancy, perceived reasonability of the audit process and whether penalties and fines imposed are fairly applied Honda 73.3 SsangYong 71.4 Mahindra 69. Citroen 64.3 Ford Mazda 69.5% of dealers believe that franchise audits are relevant; More than 70% of dealers feel that franchise audits are reasonably conducted; and More than 60% of dealers believe that penalties and/or fines imposed are reasonable and fairly applied Toyota 60.6 Volkswagen 60.3 Average, 66.9 Daihatsu Subaru 60.0 GMSA 58.3 Jaguar 50.0 Mitsubishi 45.8 Nissan Lexus Peugeot 17.6 Vehicle Distribution Franchise Agreements This is an area that has always been of concern to dealers. However, the results of the 009 survey indicate, across industry, an A series of questions covering this critically important area were put to all dealers. As with most of the questions simple / answers were required. Table 1 presents Page 5 of 14

8 Confidential DSi 009 Media Support the percentage of dealers who responded positively to each of the questions on Vehicle Distribution: This section is dedicated to the marketing, advertising and public relations support provided by the Manufacturer/Importer for the respective product ranges. A ten point rating scale was used where 1 = not at all and 10 = to a large degree. The results are reflected in figure 7. Table 1 Vehicle Distribution % % Is the vehicle ordering system used by your Manufacturer/ Importer fair to all dealers? Do you get accurate information on the progress of vehicle orders that you have placed? Figure 7 Media Support Are vehicles delivered to your dealership regularly on time? 5. - Marketing Support Advertising Support % Public Relations Support 00 When a new vehicle is launched is the vehicle allocation system used, fair to all dealers? % % Are you able to get enough stock to meet market demand? % Are you usually able to get the right mix of vehicle models to meet market demand? % 0 1 The condition of the vehicles when they arrive at the dealership was also evaluated. The following question was asked: Using a 10 point scale, where 1 = Poor Condition and 10 = Excellent Condition how would you rate the condition of new vehicles that arrive at your dealership? The average of 9 and 10 scores allocated are being depicted in figure 6 below. Figure % A gu ar Ja ah in M an TA T iss N Vo lks w ag er ce en de sb en Ss z an gy on g M its ub ish i Pe ug eo t C itr oe C hr n ys le FG rj A ee SA p Do dg La e nd Ro ve r Ho n Fo da rd M az da M Le xu s Re na ult To yo ta D aih at su G M SA BM W Hy un da i Su ba ru I o IN Vo lv A M ud i 0.0% 0.0% dr a 0.0% 10.0% 6.7% 9.7% 0.0% 17.6% 1.1% 3.5% 1.4% 33.3% 8.6% 5.0% Average, 30.8% 0.0% 0.0% 9.0% 38.0% 37.5% 39.% 38.7% 41.7% 40.7% 43.5% 4.9% 50.0% 48.9% 50.0% 50.0% 60.0% 30.0% Dealer Advertising Support 70.0% 40.0% 3 The results indicate that more than 40% of dealers awarded a seven or eight score (relatively satisfied) with the media support provided by the Manufacturer/Importer. 3.5% of dealers were to a large degree satisfied with the media support received from Manufacturers/Importers. Using a 10 point scale, where 1 = Poor Condition and 10= Excellent condition how would you rate the condition of new vehicles that arrive at your dealership? (Top two rating only) 50.0% More than 70% of all dealer principals believe that Manufacturers/Importers do provide support for dealer advertising programmes. The brands regarded as providing the best support are: Volkswagen; Audi; ; GMSA; and Honda. Page 6 of 14 10

9 Confidential DSi 009 Parts In the parts discipline five areas were probed; Parts Availability, Parts Delivery system, Delivery Reliability, Parts Return Policy, and obtaining parts that are not readily available. Delivery Reliability. At least 90% of Lexus and Land Rover dealers feel that parts are usually delivered on time. This area appears to be problematic for SsanYyong, Citroen, Toyota, Nissan, Honda and Daihatsu. Parts Return Policy. Mercedes Benz, Mitsubishi and Chrysler/Jeep/Dodge have a parts return policy that is regarded by most of their dealerships as the Industry Best. Parts Availability. On this issue, overall, more than 65% of dealers feel that parts availablity is at acceptable levels. Significantly Mini and Nissan are the only local Manufacturers where more than half of the dealers DO NOT believe that parts availability is at acceptable levels. Volkswagen and Lexus dealers were most satisfied with the availability of parts from their Manufacturer. Figure 9 Parts Return Policy Mercedes Benz Subaru Volvo 57.1% Ford Mazda 56.8% Audi Toyota 5.% Lexus 5.0% 47.7% TATA 47.6% 4.5% MINI 75.% 7.4% Hyundai 71.1% Volkswagen 70.9% Chrysler Jeep Dodge 70.0% Ford Mazda 70.0% Toyota 68.9% Mahindra 68.6% Renault 64.3% TATA 64.1% Daihatsu Citroen Jaguar 60.0% 56.9% 5.5% Industry Total, 70.6% 61.6% Honda % Another key issue for many dealers is that when parts that are not readily available are needed for example older models and/or parts that are not required often the Manufacturer or Importer provides good support in sourcing these parts. The results are reflected in figure % Nissan 008 Industry Worst are regarded by most dealers to be Nissan, Honda, Mini, Jaguar, Peugeot, SsangYong, and. 68.5% SsangYong 40.8% 40.0% Industry Total, 54.0% 43.1% Jaguar 43.8% Peugeot Nissan 73.3% 45.4% SsangYong 75.5% 73.0% 49.1% Daihatsu Land Rover Lexus 50.9% Honda GMSA 53.9% 53.1% Volkswagen 77.1% 73.9% 54.3% Renault 75.8% 73.6% 55.7% Citroen Mitsubishi Audi 60.7% Mahindra 79.0% Volvo 61.7% GMSA 77.6% Subaru 64.3% 6.8% 81.7% Peugeot 64.5% Hyundai 80.8% Mercedes Benz 77.7% Land Rover Figure 8 Parts Delivery System MINI 77.8% Chrysler Jeep Dodge Parts Delivery. When it comes to Parts delivery systems is regarded by their dealers to be the best in the industry, this is obtained by calculating the straight average of scores obtained. Figure 8 reflects the results obtained. 8.4% Mitsubishi Page 7 of 14

10 Confidential DSi 009 that warranty audits are handled fairly. In general most dealers are satisfied that warranty reimbursement payments are made on time each month exceptions are Honda, Mahindra, Mitsubishi, Peugeot and Tata dealerships. Figure 10 Parts t Readily Available Support 77.8% Mercedes Benz 73.% Subaru 71.4% Mitsubishi 71.3% Hyundai 69.1% Volkswagen 67.9% Chrysler Jeep Dodge 67.9% Volvo 67.1% Lexus 66.0% 65.9% Mahindra 65.7% Audi 65.3% Peugeot Two commonly supported areas are financial assistance to purchase New Vehicle stock and financial assistance to purchase loan cars and demonstrators. New Vehicle Stock performers were: 64.7% 63.3% Renault 61.9% MINI 61.5% Ford Mazda 61.1% Land Rover 61.0% Toyota 60.5% GMSA 60.3% TATA 59.7% Daihatsu 59.4% Citroen 59.3% 51.5% Nissan 43.0% Jaguar 4.5% 35.3% Industry Total, 61.7% SsangYong Honda Dealer Support Financial Chrysler/Jeep/Dodge; Citroen; Mitsubushi; and Mercedes Benz. It can be noted that across industry the average rating out of ten received for this question was 5.. The brands mentioned were the only brands scoring above 70% for this question Warranty & Goodwill Warranty, Goodwill and policy claims support was tested. This is an important area of support and pivotal in customer satisfaction. Goodwill. The brand that received the highest rating was. 75% of dealers agreed that their Manufacturer/Importer usually comes to the party when they need assistance on a Goodwill claim for a customer. Policy Claims. Best at providing assistance for "Policy Claims" for a customer, (claims for known defects that occur outside of the warrantee period) are Land Rover, Mini and Volvo. Warranty. More than 90% of dealers feel that warranty claim procedures are clear and easy to understand; Audi, Jaguar, Kia, Lexus, Subaru and Volvo dealers unanimously agreed with this statement. More than 80% of dealer principals believe In the loan cars and demonstrators section, Mercedes Benz, and Mitsubishi received the highest rating for providing dealers with assistance to purchase loan cars and demonstrators. Dealer Support Training Training is an area dealers usually rate very highly in previous years the results for training support were always exceptional. However, there has been a continuous drop in the percentage of dealers who feel that sufficient technical training is provided for dealer staff. In % of dealers believed their Manufacturer/Importer provided sufficient technical training for dealer staff. In 009 the percentage dropped to 78.8%. Fewer dealers also believe that sufficient non-technical training is provided as this percentage has reduced from 76.5% in 008 to 75.1% in 009. Best performers are Hyundai, Peugeot, and Renault. Page 8 of 14

11 Dealer Support Regional/Area Managers Dealers were asked if they believed that the support they receive from regional/area SALES manager/s and AFTER SALES manager/s add value to their dealerships. Best in both regional/area SALES and AFTER SALES are, Audi, Hyundai and Renault. Poorest performing regional/area managers are those supporting Honda, Mahindra and Subaru dealerships. Dealer, Customer and Investor Friendly? NADA determined that issues around the relationship between dealers and their respective Manufacturers/Importers can be categorised into three types: 1. Dealer Friendly. Customer Friendly 3. Investor Friendly Some questions fall into more than one category and in such cases they are allocated to both groups. The net result is that there are 9 questions that measure Dealer Friendliness, 4 questions that measure Customer Friendliness and 30 questions that relate to Investor Friendliness. NADA allocated an importance factor for each question using a 4 star system. I.e. a question of lesser importance was allocated 1 star vs. a major importance factor of 4 stars. On this basis, for Dealer Friendliness there are 1 lone stars, 5 two stars, 1 three star and four stars. By using a simple weighting amongst the Dealer Friendly questions the 1 star questions are weighted.4%, the star questions are weighted 4.8%, the 3 star questions are weighted 7.1% and the 4 star questions are weighted 9.5% to derive a score out of 100. For Customer Friendliness there are 15 lone stars, 6 two stars, three stars and one 4 star. The 1 star questions are weighted.7%, the star questions are weighted 5.4%, the 3 star questions are weighted 8.1% and the 4 star questions are weighted 10.8% to derive a score out of 100. For Investor Friendliness there are 17 lone stars, 6 two stars, 3 three stars and 4 four stars giving a total score of 54. Therefore a lone star in this section is weighted 1.9% a two star is weighted 3.7% a three star is weighted 5.6% and a 4 star is weighted 7.4%. Dealer Friendly Questions & Weightings 1.1 How satisfied are you with your Manufacturer/Importer Provide positive referrals for your franchise to a friend wanting to buy a dealership Communicates openly and honestly.4. Committed to win/win solutions Trust their leaders to behave with fairness and integrity.4.4 Values people and relationships ahead of short-term profits Are the running cost/rules and CSI costs associated with your branded approved programme onerous? 4. Does your current CSI programme assist in improving your business? Does your Manufacturer/Importer use CSI results to award rewards? Does your Manufacturer/Importer use CSI results to inflict penalties?.4 5. Does your Manufacturer/Importer provide adequate support i.e. marketing your product range? Does your Manufacturer/Importer provide adequate support i.e. advertising your product range? Does your Manufacturer/Importer provide adequate support i.e. public relations for your product range? Page 10 of 14

12 5.5 Do you get financial support for dealer advertising programs.4 6. You have commercial independence to make own decisions in running your business Is the vehicle ordering process used, fair to all dealers Rate the Support provided to get parts needed that are not readily available Are warranty claims procedures clear and easy to understand? Do you believe that warranty audits are handled fairly? Do you believe that Franchise audits are relevant? The Franchise audits conducted are reasonably conducted Provide effective technical training for dealer staff Provide effective non-technical training for dealer staff Provide effective sales training for dealer staff Does your Manufacturer/Importer provide Financial assistance for training? Considering dealer time pressures and workload is dealer training schedule convenient Your Manufacturer/Importer has effective strategies for vehicle financing Support you receive from regional/area SALES manager/s add value to your dealership Support from regional/area AFTER SALES manager/s adds value to your dealership.4 Dealer Friendly Score Average, AUDI HYUNDAI RENAULT CHRYSLER JEEP DODGE VOLKSWAGEN GMSA TOYOTA LAND ROVER VOLVO MERCEDES BENZ LEXUS FORD MAZDA SSANGYONG PEUGEOT MINI DAIHATSU MITSUBISHI JAGUAR SUBARU NISSAN CITROEN MAHINDRA TATA HONDA Page 11 of 14

13 Customer Friendly Questions & Weightings.5 Makes it easy for your customers to do business with you Sets the standard for excellence in its industry Has a winning dealership strategy in terms of satisfying customers Do you believe that the current CSI program is effective as a management tool? To what degree is your CSI levels influenced by Vehicle Supply Problems To what degree is your CSI levels influenced by Vehicle Quality Problems To what degree Is your CSI levels influenced by poor or inadequate warranty and goodwill support To what degree is your CSI levels influenced by Parts Supply Problems.7 7. Is the lead time accurate on the progress of vehicle orders that you have placed Are vehicles delivered to your dealership regularly on time When a new vehicle is launched is the vehicle allocation system used, fair to all dealers Are you able to get enough stock to meet market demand Are you usually able to get the right mix of vehicle models to meet market demand Is parts availability from your Manufacturer/Importer at acceptable levels.7 8. Are parts delivered to your dealership regularly on time Rate the Parts delivery system used by your Manufacturer/Importer Are accessories delivered to your dealership regularly on time? Rate the Support provided to get parts needed that are not readily available Are they supportive when you need assistance on a customer Goodwill claim Provide assistance for "Policy Claims" for customers eg.known defects outside warranty Provide effective technical training for dealer staff Provide effective non-technical training for dealer staff Provide effective sales training for dealer staff Your Manufacturer/Importer has effective strategies for vehicle financing.7 Customer Friendly Score Average, HYUNDAI RENAULT MINI AUDI CHRYSLER JEEP DODGE MERCEDES BENZ SSANGYONG LEXUS VOLKSWAGEN LAND ROVER MITSUBISHI JAGUAR GMSA DAIHATSU TOYOTA VOLVO PEUGEOT SUBARU CITROEN FORD MAZDA MAHINDRA TATA HONDA NISSAN Page 1 of 14

14 Investor Friendly Questions & Weightings 1.1 How satisfied are you with your Manufacturer/Importer Provide positive referrals for your franchise to a friend wanting to buy a dealership Attracts and retains outstanding people (employees, partners, etc.) To what extent does a Manufacturer/Importer' branded approved used car programme add to used car gross profits? How effective is your Manufacturer/Importer branded approved used car program in increasing gross and volumes vs. your own non branded floor? 3.6 Does the used car program assist in maintaining good used car values for the brand Is the used vehicle allocation and distribution system for fleet and demo vehicles fair? Does your current CSI programme assist in improving your business? Does your Manufacturer/Importer use CSI results to award rewards? Does your Manufacturer/Importer use CSI results to inflict penalties? Does the range of vehicles available allow you to compete adequately in the market Do you get financial support for dealer advertising programs Investment that you make in premises to comply with CI requirements are reasonable You have commercial independence to make own decisions in running your business Is the cancellation clause provided for in your franchise agreement reasonable In the event of cancellation is the notice period provided for fair and reasonable If a dealership is cancelled through no fault of its own, is there adequate compensation When a new vehicle is launched is the vehicle allocation system used, fair to all dealers Are you able to get enough stock to meet market demand Are you usually able to get the right mix of vehicle models to meet market demand Rate the Parts RETURN POLICY for aged/redundant stock used by your Manufacturer/Importer Do you believe that warranty audits are handled fairly? Are correctly submitted warranty reimbursement payments made on time as agreed Penalties / fines are applied for non-compliance of Franchise Standards and Processes Penalties and/or fines imposed are reasonable and fairly applied Provide financial assistance to purchase New Vehicle stock Provide financial assistance to purchase required loan cars and demonstrators Dealer margin on new vehicle sales, incl. incentives and rebates are reasonable Gross Profit you make on parts are reasonable Does your Manufacturer/Importer provide Financial assistance for training? Investor Friendly Score Average, HYUNDAI RENAULT AUDI CHRYSLER JEEP DODGE SSANGYONG MERCEDES BENZ JAGUAR VOLVO LAND ROVER CITROEN GMSA VOLKSWAGEN SUBARU TOYOTA Page 13 of 14 FORD MAZDA MAHINDRA MINI LEXUS MITSUBISHI DAIHATSU NISSAN TATA PEUGEOT HONDA

15 Overall Performance Overall The complete results are presented in the appendix to this report in tabular format. The overall results are reflected in the following figure: Overall Score Dealer Friendly (0%); Customer Friendly (40%); Investor Friendly (40%) Average, HYUNDAI RENAULT AUDI CHRYSLER JEEP DODGE MERCEDES BENZ SSANGYONG VOLKSWAGEN LAND ROVER MINI GMSA JAGUAR VOLVO LEXUS TOYOTA MITSUBISHI SUBARU DAIHATSU CITROEN FORD MAZDA MAHINDRA PEUGEOT TATA NISSAN HONDA Consistently good ratings across most questions result in Hyundai leading the scores by a significant margin. Brands that improved significantly are Volkswagen and both improving on overall results by more than 10% compared to the 008 results. Audi and Chrysler/Jeep/Dodge also showed considerable improvement both brands improving by more than 7% compared to the 008 results. There appears to be a clear correlation between Dealer Satisfaction and strong brand growth. Where brands are growing strongly and sales demand is good the dealer Manufacturer/Importer relationship flourishes. When the Brand comes under pressure the relationship deteriorates; ironically it is in these more difficult times and market conditions that the relationship is even more important, this is where positive leadership and relationship development makes all the difference. The new survey format has been very successful. Dealer feedback has been positive and the quality and depth of the responses impressive. We expect to continue with the revised structure, approach and methodology in 010. Page 14 of 14

16 APPENDIX

17 Dealership Name: Dealer Principal: Manufacturer/Importer: How long has this dealership been open? Telephone: Remember throughout the questionnaire this is the Franchisor you are reporting on. How long have you been the Dealer Principal with this Brand? Do you represent any other brands? Please specify which: Does your franchisor have any, direct or indirect, shareholding in your dealership? If yes, what percentage equity do they hold? % Is your Dealership part of a Dealer Group? If ; which one? SECTION1 1 How satisfied are you with your Manufacturer/Importer? 3 Given free choice how likely are you to be working with this franchise/brand two years from now? If you were approached by a friend who was interested in buying/purchasing a dealership, how likely are you to provide positive referrals for your current franchise? <<Extremely Dissatisfied Extremely Satisfied>> << t at all Likely Very Likely >> << t at all Likely Very Likely >> SECTION Please rate your level of agreement. Your Manufacturer/Importer ('s): 1 communicates openly and honestly is committed to win/win solutions << Strongly Disagree Strongly Agree >> << Strongly Disagree Strongly Agree >> 3 leaders behave with fairness and integrity << Strongly Disagree Strongly Agree >> 4 values people and relationships ahead of it's own shortterm profits << Strongly Disagree Strongly Agree >> 5 makes it easy for your customers to do business with you << Strongly Disagree Strongly Agree >> sets the standard for excellence in its industry has a winning dealership strategy in terms of satisfying customers attracts and retains outstanding people (employees, partners, etc.) << Strongly Disagree Strongly Agree >> << Strongly Disagree Strongly Agree >> << Strongly Disagree Strongly Agree >>

18 SECTION 3 1 To what extent does a Manufacturer/Importer's branded approved used car programme add to used car Gross Profits? Does your Manufacturer/Importer have a branded approved used car program? << Strongly Disagree Strongly Agree >> 3 4 If your answer to the previous question was yes, are you part of the Manufacture/Importers' approved used car programme? Are the running costs/rules and CSI costs associated with your Manufacturer/Importer' branded approved programme onerous? N/A N/A 5 How effective is your Manufacturer/Importers' branded approved used car program in increasing gross profits and volumes vs your own non branded floor? << t Effective Very Effective>> N/A Does your Manufacturers/Importers' approved used car program assist in maintaining good used car values for the brand? Does your Manufacturer/Importer have a vehicle allocation and distribution system for fleet and demo vehicles? Is the used vehicle allocation and distribution system for fleet and demo vehicles fairly handled? SECTION 4 1 Do you believe that the current CSI program is effective as a management tool? 5 Does your current CSI programme assist in improving your business? 3 To what degree is your Customer Satisfaction levels influenced by Vehicle Supply Problems? 4 To what degree is your Customer Satisfaction levels influenced by Vehicle Quality Problems? To what degree is your Customer Satisfaction levels influenced by poor or inadequate warranty and goodwill support? 6 To what degree is your Customer Satisfaction levels influenced by Parts Supply Problems? << t at All To a Large Degree>> << t at All << t at All N/A N/A To a Large Degree>> To a Large Degree>> << t at All To a Large Degree>> << t at All To a Large Degree>> 7 Does your Manufacturer/Importer use CSI results to award rewards? 8a 8 Does your Manufacturer/Importer use CSI results to inflict penalties? If your Manufacturer/Importer implements rewards/penalties based on CSI results; please explain how this is done N/A N/A

19 SECTION 5 1 Does the range of vehicles available from your Manufacturer/Importer allow you to compete adequately in the market? 1a If, What do you believe is missing from the range? 3 4 Does your manufacturer/importer provide adequate support i.e. marketing your product range? Does your manufacturer/importer provide adequate support i.e. advertising your product range? Does your manufacturer/importer provide adequate support i.e. public relations for your product range? << t at All << t at All << t at All 5 Do you get support from your Manufacturer/Importer for dealer advertising programs? To a Large Degree>> To a Large Degree>> To a Large Degree>> SECTION 6 1 Do you believe that the investment that you have to make in premises to comply with the Manufacturer/Importers corporate identity requirements is reasonable? 3 Is the cancellation clause provided for in your franchise agreement reasonable? 4 Does your franchise agreement provide you with reasonable flexibility so you can make your own decisions in running your business? In the event of cancellation is the notice period provided for fair and reasonable? I don't know I don't know I don't know 5 When a dealership is cancelled, through no fault of the dealership, is adequate compensation provided for? I don't know SECTION 7 1 Is the vehicle ordering process used by your Manufacturer/Importer fair to all dealers? Do you get accurate information on the progress of vehicle orders that you have placed? 3 Are vehicles delivered to your dealership regularly on time? 4 Using a 10 point scale, where 1 = Poor Condition and 10= Excellent Condition, how would you rate the condition of new vehicles that arrive at your dealership? << Poor Condition Excellent Condition >> 5 When a new vehicle is launched, is the vehicle allocation/order system used by your Manufacturer/Importer fair to all dealers? 6 Are you able to get enough stock/order opportunity to meet market demand? 7 Are you usually able to get the right mix/order of vehicle models to meet market demand?

20 SECTION 8 1 Is parts availability from your Manufacturer/Importer at acceptable levels? Are parts delivered to your dealership regularly on time? 3 Using a 10 point scale, where 1 = Very Bad and 10 = Very Good, how would you rate the parts delivery system used by your Manufacturer/Importer? << Very Bad Very Good >> 4 Are accessories delivered to your dealership regularly on time? 5 Using a 10 point scale, where 1 = Very Bad and 10 = Very Good, how would you rate the parts RETURN POLICY/SUPPORT for aged/redundant stock used by your Manufacturer/Importer? << Very Bad Very Good >> 6 Using a 10 point scale, where 1 = Very Bad and 10 = Very Good, how would you rate the support provided to get parts needed that are not readily available? << Very Bad Very Good >> SECTION 9 1 Is your Manufacturer/Importer usually supportive when you need assistance on a Goodwill claim for a customer? <<t Very Supportive Very Supportive>> Does your Manufacturer/Importer provide assistance for "Policy Claims" for a customer - for example; claims for known defects that occur outside of the warranty period? 3 Are warranty claim procedures clear and easy to understand? 3a If NO, Please indicate what procedures are not clear and easy to understand: 4 Do you believe that warranty audits are handled fairly? 4a if NO, Please indicate what aspects of the warranty audits are NOT handled fairly? 5 Are warranty reimbursement payments, which are correctly submitted, made on time as agreed? SECTION 10 1 Does your Manufacturer/Importer conduct Franchise compliance audits? 3 On 10 point scale where 1 = t Relevant and 10 = Very Relevant, do you believe that Franchise audits are relevant? On 10 point scale where 1 = Unreasonable and 10 = Reasonable, do you believe that the Franchise audits are reasonably conducted? <<t Relevant <<Unreasonable Very Relevant>> Reasonable >> N/A 4 Does your Manufacturer/Importer apply penalties and/or fines for non-compliance of Franchise Standards and Processes? 5 On 10 point scale where 1 = Unreasonable and 10 = Reasonable, do you believe that penalties/fines imposed are reasonable and fairly applied? << Unreasonable Reasonable >> N/A

21 SECTION 11 1 At what point does the Manufacturer/Importer start counting interest free days? At the time of the order When the invoice is received When receipt of car has occurred Other (please specify below) 6 Does your Manufacturer/Importer provide financial assistance to purchase New Vehicle stock? 3 Does your Manufacturer/Importer provide financial assistance to purchase required loan cars and demonstrators? 4 Are you satisfied that your average dealer margin on new vehicle sales, including incentives and rebates is reasonable? 5 Do you believe that the Gross Profit you make on parts is reasonable? Does your Manufacturer/Importer provide effective technical training for dealer staff? 7 Does your Manufacturer/Importer provide effective nontechnical training for service dealer staff? << Never Always>> << Never Always>> << Never Always>> << Never Always>> << Never Always>> << Never Always>> 8 Does your Manufacturer/Importer provide effective sales training for dealer staff? 9 Does your Manufacturer/Importer provide Financial assistance for training? 10 Considering dealer time pressures and workload, is the dealer training schedule convenient? 11 1 << Never <<Never << Never Do you believe that your Manufacturer/Importer has effective strategies for vehicle financing? Always>> Always>> Always>> What products or processes can be included to make the current strategies for vehicle financing more effective? 13 Does the support that you receive from the regional/area SALES manager/s add value to your dealership? 14 Does the support that you receive from the regional/area AFTER SALES manager/s add value to your dealership? << Never Always>> << Never Always>> SECTION 1 1 What is the one thing your Franchisor can do to increase your loyalty to them? If you could choose another MOTOR franchise which one would you most like to have? a Why would you choose that Franchise?

22 SECTION 13 1 What is your current RETAIL LABOUR RATE at your dealership? R (excluding VAT) What is your current warranty re-imbursement LABOUR RATE? R (excluding VAT) 3 What is your current MAINTENANCE PLAN LABOUR RATE? R (excluding VAT) 4 What is your current SERVICE PLAN LABOUR RATE? R (excluding VAT) 5 When do you annually review your RETAIL LABOUR RATE? (which month) SECTION 14 1 NADA is the national body that represents the interests of all the dealers. What do you think the main priority of NADA s activities over the next 1 months should be? 3 Using a ten point rating scale, where 10 = Excellent and 1 = Very Poor; How do you rate NADA on Communication and Keeping Dealers Informed? If you were approached by another dealer who is not a NADA member how likely are you to recommend that he/she become a NADA member? << Very Poor Excellent>> << t at all Likely Very Likely >> 4 Finally we would like to use this opportunity to update the NADA database. Please provide the following information: Sales Manager: Service Manager: Parts Manager: Used Car Manager: F&I or Business Manager 1: F&I or Business Manager : SECTION 15 1 Has your company/dealership been BBBEE certified yet? 1a If YES, Which rating agency was used? If your answer to question 1 was yes, can you please specify at what level you are BBBEE accredited? Signed: Date:

23 NADA - DSi 009 Passenger & LCV Industry Total Top 5% Bottom 5% m a x AUDI CHRYSLER JEEP DODGE CITROEN DAIHATSU FORD MAZDA GMSA HONDA HYUNDAI JAGUAR Sample # Overall # Dealer Friendly (0%) # Customer Friendly (40%) # Investor Friendly (40%) # How satisfied are you with your Manufacturer/Importer # Provide positive referrals for your franchise to a friend wanting to buy a dealership # Communicates openly and honestly # Committed to win/win solutions # Trust their leaders to behave with fairness and integrity # Values people and relationships ahead of short-term profits # Makes it easy for your customers to do business with you # Sets the standard for excellence in its industry # Has a winning dealership strategy in terms of satisfying customers # Attracts and retains outstanding people (employees, partners, etc.) # What extent a Man./Importer' branded approved used car programme add to used car gross profits? # Are the running cost/rules and CSI costs associated with your branded approved programme onerous? # Effective Man./Importer approved used car program in increasing gross and volumes vs. own non branded? # Does the used car program assist in maintaining good used car values for the brand # Is the used vehicle allocation and distribution system for fleet and demo vehicles fair? # Do you believe that the current CSI program is effective as a management tool? # Does your current CSI programme assist in improving your business? # To what degree is your CSI levels influenced by Vehicle Supply Problems # To what degree is your CSI levels influenced by Vehicle Quality Problems # To what degree Is your CSI levels influenced by poor or inadequate warranty and goodwill support # To what degree is your CSI levels influenced by Parts Supply Problems # Does your Manufacturer/Importer use CSI results to award rewards? # Does your Manufacturer/Importer use CSI results to inflict penalties? # Does the range of vehicles available allow you to compete adequately in the market # Does your manufacturer/importer provide adequate support i.e. marketing your product range? # Does your manufacturer/importer provide adequate support i.e. advertising your product range? # Does your manufacturer/importer provide adequate support i.e. public relations for your product range? # Do you get support for dealer advertising programs # Investment that you make in premises to comply with CI requirements are reasonable # You have commercial independence to make own decisions in running your business # Is the cancellation clause provided for in your franchise agreement reasonable # In the event of cancellation is the notice period provided for fair and reasonable # If a dealership is cancelled through no fault of its own, is there adequate compensation # Is the vehicle ordering process used, fair to all dealers # Do you get accurate information on the progress of vehicle orders that you have placed? # Are vehicles delivered to your dealership regularly on time # When a new vehicle is launched is the vehicle allocation system used, fair to all dealers # Are you able to get enough stock to meet market demand # Are you usually able to get the right mix of vehicle models to meet market demand # Is parts availability from your Manufacturer/Importer at acceptable levels # Are parts delivered to your dealership regularly on time # Rate the Parts delivery system used by your Manufacturer/Importer # Are accessories delivered to your dealership regularly on time? # Rate the Parts RETURN POLICY for aged/redundant stock used by your Manufacturer/Importer # Rate the Support provided to get parts needed that are not readily available # Are they supportive when you need assistance on a customer Goodwill claim # Provide assistance for "Policy Claims" for customers eg.known defects outside warranty # Are warranty claims procedures clear and easy to understand? # Do you believe that warranty audits are handled fairly? # Are correctly submitted warranty reimbursement payments made on time as agreed # Do you believe that Franchise audits are relevant? # The Franchise audits conducted are reasonably conducted # Penalties / fines are applied for non-compliance of Franchise Standards and Processes # Penalties and/or fines imposed are reasonable and fairly applied # Provide financial assistance to purchase New Vehicle stock # Provide financial assistance to purchase required loan cars and demonstrators # Dealer margin on new vehicle sales, incl. incentives and rebates are reasonable # Gross Profit you make on parts are reasonable # Provide effective technical training for dealer staff # Provide effective non-technical training for dealer staff # Provide effective sales training for dealer staff # Does your Manufacturer/Importer provide Financial assistance for training? # Considering dealer time pressures and workload is dealer training schedule convenient # Your Manufacturer/Importer has effective strategies for vehicle financing # Support you receive from regional/area SALES manager/s add value to your dealership # Support from regional/area AFTER SALES manager/s adds value to your dealership # LAND ROVER LEXUS MAHINDRA MERCEDES BENZ MINI MITSUBISHI NISSAN PEUGEOT RENAULT SSANGYONG SUBARU TATA TOYOTA VWSA VOLVO

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