Slow and steady lift for VW service levels

VOLKSWAGEN Group Australia (VGA) managing director John White says the company’s recent focus on lifting its customer and aftersales service levels is tracking well, but not as rapidly as the management team would have hoped.

The German car-maker has finished at the bottom of the pack over the past three years in the influential annual JD Power Customer Service Index (CSI) study, which measures Australian new-vehicle buyer satisfaction with the aftersales service process.

In last year’s study, released in November, VW achieved a score of 765 out of a maximum 1000 points, which was well below the industry average of 790 but an improvement over its result in the previous two years (743 and 757 respectively).

Japanese manufacturer Mazda has topped the study over the past two years, scoring 809 points in 2014, while Honda and Toyota shared top billing in 2012.

Mr White said Volkswagen Group Australia, which includes VW and Czech brand Skoda, had made some gains, but acknowledged there was still much work to be done.

“It’s improving but not fast enough to the degree that we wanted,” he told GoAuto at the Skoda Fabia launch last week.

“Our aspirations are high. If you want to be a top-tier volume brand, if you want to be a top-tier group, and that includes Skoda, we need to continue working on that.

“And that’s a number of things, that’s service capacity expansion, which is part of all of our brands.”

Mr White said dealers are stepping up to meet VGA’s customer service standards, and added that the group has learned from its previous missteps.

“I think as the volume has gone up for both of the brands we are getting more attention from the dealers with their staff. You set some standards which the dealer needs to beat and that is a top area of focus,” he said.

“Is it improving? Yes, absolutely. Is it improving quickly enough? I acknowledge we still have work to do, but a lot better than it was, say, two years ago. We learned a lot from our past experiences.”

VGA set about improving its customer service levels in late 2012 when then managing director Anke Koeckler established a new in-house customer care centre following its poor showing in the 2012 CSI study.

Since Mr White took over the role from Ms Koeckler in April 2013, he has continued to focus on lifting Volkswagen’s aftersales service levels.

When asked when VGA will be at a point of achieving satisfactory levels of service, Mr White said “never”, adding that customer expectations are constantly changing and car-makers need to adapt accordingly.

“Because you have got to sustain it, too. It’s simple. You want to be the top and then once you are on the top you want to stay there. And customer expectations are always changing,” he said.

“I look at the expectations of customers today in this market versus what I saw in the other two markets I worked in, Canada and the US. I look at the expectations today versus when I got here two-and-a-half years ago. So the bar continues to rise.” Mr White said while the goalposts are always shifting, VGA’s dealer network had made significant investments to help improve its standing in the eyes of its customers.

“We have got some very good dealers. We have some dealers that have spent some big bucks, made huge investments in facilities, huge investments in infrastructure and training. And we have some dealers that really do this well.

“We have got a group of dealers out there that have figured out how to do it.

Question is, how do we get everybody up to that standard.”

In terms of dealer footprint in Australia, Mr White said he was satisfied with the coverage, but added that there were a couple of areas that need to be looked at.

Currently there are 101 Volkswagen dealers across Australia and 37 Skoda sales and service centres.

“We don’t have plans to materially increase the Volkswagen dealer footprint. We probably have three or four holes around the country depending on where we want to go. And with Skoda we are looking at maybe one or two,” he said.

“I think as you get dealers to invest and build facilities that can handle the infrastructure, you are in good shape. We have told our dealers that we are looking at increasing the footprint over time between, say, now and 2018. But whatever we do is going to be done in a methodical, logical manner.”