New Car Buyers in India Are Choosing Dealers With Good Reputation: Study

New vehicle buyers in India are choosing dealers based on their reputation and operational effectiveness, claims the J.D. Power 2014 India Sales Satisfaction Index (SSI) Study released today.

The study claims that reputation of the dealer as a reason to buy from a particular outlet has increased by 11 per cent in the last 5 years. Faster delivery time, availability of the exact model and ease of negotiation are the other reasons that have shown a significant rise during the same period. Buyers who chose their dealer based on the aforementioned reasons paid an average of 4 per cent more for their vehicle than those who selected a dealer for reasons such as location or receiving the best deal.

Talking about the ranks given to different manufacturers in the study, Toyota scores the top-spot with a score of 866, performing particularly well across all factors. Maruti Suzuki India ranks second, with a score of 860. Honda, Hyundai and Mahindra ranked third, in a tie at 859 each. The study is based on responses from more than 8,000 new vehicle owners who bought their vehicles between September, 2013 and April, 2014. Conducted from March to July, 2014, the study evaluated more than 71 models within the mass-market segment.

"The Indian automotive industry has been facing significant challenges over the past two years, but dealers that are able to present their offerings to customers in a transparent manner, aided with availability of the exact model and commitment of a faster delivery time are often rewarded because customers are willing to spend more for their vehicle," said Mohit Arora, executive director at J.D. Power Asia Pacific, Singapore.

The study examines seven factors that contribute to new-vehicle buyers' overall satisfaction with the sales experiences: delivery process, delivery timing, salesperson, sales initiation, dealer facility, paperwork and deal (listed in order of importance).

The study also finds out that 29 per cent of new-vehicle buyers used the Internet during the purchase of a new-vehicle in India. Of the total online search traffic, 52% visit manufacturers website, while 40% visit other auto websites.

"Automakers need to work on a strategy to continuously monitor and respond to any feedback posted on such websites, as reviews and comments posted on these websites are likely to impact perceptions consumers have of the brands during their shopping process," said Arora.

"With heightened competitive intensity in the Indian automotive market, most automakers are ensuring better implementation of standard practices, faster vehicle delivery and creating an engaging customer experience through proactive communications resulting in an increase in the overall purchase process satisfaction," he added.