Customer satisfaction scores – a dealer benefit, or another factory program? That issue, linked closely to F&I selling and follow-up, received a thorough airing this past April at a pioneering industry forum held in Indian Wells, Calif.

The California New Motor Vehicle Board (CNMVB) staged the roundtable in Indian Wells on the eve of the annual convention of the California Motor Car Dealers Association (CMCDA). Thirteen producers of cars, trucks and motorcycles sent dealer relations executives and attorneys to explore the values and criticisms of CS ratings with CNMVB members and staff.

The industry roundtable was the second annual event of this type undertaken by the regulatory agency, whose seven members include four public representatives and three franchised dealers.

Customer satisfaction ratings was chosen to lead off the 2003 roundtable, said Board executive director Tom Novi, because “manufacturers are increasingly using dealer customer satisfaction surveys to evaluate the customer experience in purchasing an automobile.”

What’s more, as board member and roundtable moderator Robert T. (Tom) Flesh declared in opening the discussion, “resulting scores may be used, at least in part, to infer a ‘premiere status’ label on certain dealerships, or alternately as a basis for remedial action against a dealer.”

During the course of the ensuing lively give-and-take, unusually candid in view of the presence of competing factories in a setting rarely if ever done before, it was brought out that consistently poor CS ratings showed up in manufacturer termination actions against dealers. Often, manufacturer executives said, the F&I experience was a factor in depressing ratings in the absence of product problems or extended service warranty coverage.

After Flesh asked whether dealers are comfortable with the survey process, the two dealer members on hand answered that in-house “manipulations” aimed at skewing returns to the positive side, “overkill” on serving customers and language difficulties among immigrant owners pose unresolved issues.

“From the beginning (15 years ago), when J.D. Power came on the scene,” said member David W. Wilson, a Toyota-Lexus-Ford dealer based in Orange, Calif., “dealers have offered inducements like a free tank of gas to help customers fill out the forms. Our experience is that mostly customers happy with their products fill out the forms.” If they’re unhappy, says Wilson, they’ll react by buying their next car somewhere else and neglect the forms. “Besides,” he adds, “getting forms every three or six months amounts to over-surveying.”

The newest dealer member, Robert V. Branzuela, a Mitsubishi dealer in San Mateo, Calif., introduced the language issue – which is especially keen in the immigrant communities of the Golden State. “It’s hard to get ethnic groups to respond,” Branzuela said. “The only foreign language used on the surveys is Spanish, but there are 108 languages spoken in the Los Angeles school district.”

“New immigrants are a large part of our vehicle buying groups,” says Branzuela,” and many are reluctant to fill out forms, coming from non-democratic places. That’s something that could lower response rates from satisfied customers.”

Toyota USA vice-president for retail market development, Nancy Davies, said her company is returning to phone surveying as a response to the concerns raised by the dealer members. “Our No. 1 aim with the customer dealer experience is customer retention,” she said. “The survey returns are important, and we feel most of our customers take them seriously enough not to be manipulated.”

Frank H. Dunne, GM’s executive director of vehicle sales, service and marketing-retail relationships, voiced the belief that survey results are “valuable as a diagnostic tool. If a dealer keeps getting a lousy CSI, he’s probably a lousy dealer.”

Another GM executive on hand, R. F. (Ron) Sobrero, general manger of dealer relations, vehicle sales service and marketing, declared that an intent of surveying and rating dealers is so that “they understand how important it is to treat them right (in order) to keep them. If they don’t, they won’t.”

On the “manipulation” issue, American Honda’s senior manager for market representation, Frank Beniche, contended that “customers can’t be manipulated anymore. They’re too informed about the products and the dealers.”

In a parting comment, the retiring executive vice-president of the CMCDA, Jay Gorman, declared as an interested attendee that “survey results can be misused and should not be a reflection on dealer performance. We see that results can differ substantially between mail returns and phone surveys.”

After the meeting, Tom Novi said that the Board was not looking at amending the state’s franchise law to outlaw use of CSI scores to punish or even terminate dealers. Several states have adopted such amendments, however, according to Gorman’s successor as manager of CMCDA, Peter Welch, in response to a Ford Blue Oval’s setting of five CSI standards in determining whether dealers can remain certified for Oval awards. F&I is a key Blue Oval area.

Novi said he was pleased with the “candor” expressed during the roundtable discussions, which also covered increasing diversity among dealer bodies, the challenges facing producers and dealers with fuel cell vehicles and the growth of “kit cars” that fail to meet safety and emissions requirements.

Novi was pleased by the scope of the discussions as a “truly enlightening vehicle for state dealer-relations regulatory agencies” and said he would propose that other states consider conducting similar forums themselves or in conjunction with nearby states.

In addition to Honda, GM and Toyota, the Indian Wells roundtable had representatives on hand from BMW, DaimlerChrysler, Ford, Freightliner, Harley-Davidson International, Kawasaki, Mercedes-Benz, Nissan and Yamaha.

Alan J. Skobin of Galpin Motors, North Hills, Calif., a Ford/Lincoln Mercury/ Jaguar/Saturn/Premier dealer, is the Board’s third dealer member. The 2002 president of the Board was Frederick E. (Fritz) Hitchcock, an import dealer based in Puente Hills, Calif., was also in attendance at the roundtable.

California has about 1,700 franchised new-car and truck dealers, more than any other state.