Widely regarded auto research firm J.D. Power has released its 2020 U.S. Sales Satisfaction Index study, a measure of car owner attitudes toward dealers. Fiat, the failed brand of Fiat Chrysler Automobiles N.V. (NYSE: FCAU), received the worst grade in another blow to its future in the United States.
Buyer satisfaction with dealers is based on several categories of data collected by J.D. Power from 35,816 people who bought or leased cars from January 2020 through July 2020. The study was in the field from July until October. The research looked at two sets of buyers. They were those who bought cars from a given dealer (satisfaction among buyers) and those who shopped at a dealer but did not buy (satisfaction among rejecters).
Several key measurements were used to come up with grades. The first was measured among buyers. These were the delivery process, which made up 28% of the grade, while dealer personnel made up 21%, “working out the deal” was 19%, paperwork completion was 19%, dealership facility was 10% and dealership website was 4%.
Rejecter satisfaction was based on five things. The salesperson was 28%, followed by price at 27%, negotiation at 18%, dealership facility at 14% and variety of inventory at 13%.
E-commerce satisfaction has grown over the years. The pandemic has only accelerated that. Chris Sutton, vice president of automotive retail at J.D. Power, remarked, “The pandemic provided dealers with a wide-open path to allow different approaches to sell vehicles outside of their traditional showroom sales process.”
Ratings were divided into two categories: luxury brands and mass market brands. Final grades were based on a 1,000-point scale. Lincoln won the luxury brand category with a score of 827, followed closely by Lexus and Mercedes at 826. Genesis was the lowest-rated brand in the segment at 773.
In the mass market segment, Mini had the best score at 824. Fiat’s score of 756 tied with corporate stablemate Chrysler.
Fiat faces two problems, neither of which it likely can overcome. The first is its extremely poor reputation for quality. The other comes from large and relentless competition from small, low-priced vehicles sold in America made by almost every global manufacturer.
Fiat sales totaled 372 in September, or about 12 a day. They have averaged less than 400 a month over the course of the first three-quarters of the year. Fiat sold 9,204 cars in 2019 and 15,521 in 2018. Its sales have fallen every year since 2014.
Fiat’s flagship is the 500 series car. With a base price of between $16,495 and $23,340, it competes with the inexpensive, low-powered small vehicles across at least a dozen other manufacturers. At the head of this list are the Toyota Yaris, Chevy’s Spark and Sonic, and the Kia Rio.
These smaller cars have experienced declines in sales, in most cases, as people move to sport utility vehicles and crossovers. For Fiat, this is a consumer trend headwind.
For parent Fiat Chrysler, the challenge has become whether it should drop the Fiat brand in America completely. Ford removed some of its cars from the U.S. market and focuses mostly on its SUVs, crossovers and pickups. Fiat, based on sales alone, should go away.
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