Collision Repairs customer & corporate expectations A Competitive Intelligence Report Prepared by Cameron Horn On behalf of Simply Smashing Auto Body Repairs June 2013 1
CONTENTS EXECUTIVE SUMMARY 3 OVERVIEW - Audi 4 OVERVIEW - Lexus 5 THE AUDI EXPERIENCE 7 AUDI SPECIFICATIONS 7 THE LEXUS EXPERIENCE 7 LEXUS SPECIFICATIONS 7 2
EXECUTIVE SUMMARY - Lexus customers seem to be happier and better satisfied customers than their Audi counterparts. - Both manufacturers require similar standards of training and equipment - The drivers of both brands would certainly appreciate, if not demand, a loan car of the brand they drive, for the duration of the repairs. - Broken promises and a somewhat misguided marketing campaign has hurt Audi s reputation and left it with a perception of being something of a substitute European luxury vehicle, more than the genuine article. - Excellent opportunity exists with both companies with Audi, to exceed customer s low(ish) service expectations and with Lexus, who currently have no Central Coast collision repairer, the closest recommended repairers being Thornleigh, Artarmon and Belmont. - The Lexus customer app for Smart-phone and tablet computer, also offers various opportunities to both market to Lexus customers but also to provide a higher level of service during the repair process. 3
OVERVIEW - Audi Audi seem to have a history of talking the talk. In all of Audi s marketing material there is plenty of use of terms like state-of-the-art, award-winning and high-tech. Audi claims to embody the principles of Vorsprung durch Technik progress through technology claiming as their slogan What drives you, drives us. 1 However, is Audi walking the walk particularly Audi Australia? Complaints abound regarding Audi s after sales service. 2 One rather concerning complaint is that Audi do not warehouse parts in Australia or even Singapore like most other luxury European brands only in Germany. This usually means a 4 to 6 week wait for parts to be shipped, while customer s cars sit idle. A recent gearbox failure problem to hit parent company VW, has affected Passat, Audi and other VW subsidiaries. The offending gearboxes appear to be from manufacturing years 2002, through to 2012, but VW has only recalled models from 2010 onwards, despite at least one fatality having arisen from the fault. This is not an adequate response for any auto manufacturer, least of all one that has ambitions of being fully competitive in the European luxury category. This is a clutch of brands under the VW parent, all positioning themselves as German engineering innovators. However, practice is falling way short of the advertised promises. A picture emerges of Audi drivers who have been promised everything, yet are not satisfied with the treatment they are receiving from the manufacturer. Complaints against Audi Australia are particularly acidic, with the general attitude summed up: Good luck with Audi Australia. We have had numerous issues with our Audi since new and found Audi Australia useless. 3 It seems many Audi drivers are not entirely happy with Audi s factory performance with surveys reporting that about 30% of Audi customers have some form of performance enhancement added to their car. 4 For a collision repairer, this means that Audi customers tend to expect high levels of service, may be disappointed thus far with what they have received, are more likely to require specialist treatment due to vehicle modifications, but at the end of the day, are buyers of a brand at the lower end of the luxury market a factor inherent in VW and Audi marketing that attempts to present high-end German engineering but at a cut price a seemingly contradictory marketing exercise. The Audi customer seems to be summed up in the phrase, Champagne taste on a beer budget. 1 www.audicentresydney.com.au/au_partner/p_au_20120/en_home/contact_us/our_dealership.html 2 http://forums.whirlpool.net.au/archive/1649646 3 http://forums.whirlpool.net.au/archive/1649646 4 http://au.news.yahoo.com/thewest/lifestyle/a/-/lifestyle/16428353/r8-expectations/ 4
OVERVIEW - Lexus On the Lexus Australia website 5 the company provides a drop-down box for owners to find their nearest body and paint repairer: When searching limited to Central Coast postcodes, none of the 4 recommended repairers are on the Central Coast Thornleigh, Artarmon, and Belmont are the nearest listed, creating a clear opportunity for a Central Coast auto body repairer to gain this all-important listing. The beauty of such a listing is two-fold. It impresses Lexus owners looking for auto body repairs, but it also impresses Lexus fleet owners whom Simply Smashing may target as potential clients. As per the following chart, Lexus has been ranked highest in customer satisfaction with dealer after-sales service in the United States, for the last 5 years. While these are not local figures, it indicates that Lexus as a corporation, has been able to internationally adhere to their founding mission statement: When Lexus was established 23 years ago, it was dedicated to providing the best customer service experience in the industry Lexus is applying the philosophy of takumi, or master craftsman, to customer service and (dealers) are given advanced tools to help them go the extra mile. 6 It is of interest that Lexus is applying a traditional Japanese philosophy as a marketing buzz-word for their customer service training. Lexus has also introduced a product information app for smart phones and i- Pads, as Lexus reports that their customers are becoming more and more technologically-savvy. 7 Such an app or a similar app could be given free to all Lexus purchasers and / or owners on the Central Coast to direct them to Simply Smashing as a preferred repairer. Pending Lexus approval as a preferred repairer, Lexus could incorporate preferred repairer status into their app, if they haven t already done so. Everything written about Lexus customer service is about it being a partnership let s discover this together is a common catchcry in Lexus philosophy. 8 5 www.lexus.com.au 6 http://pressroom.lexus.com/releases/lexus+crafting+new+approach+customer+relationships+march12 7 http://pressroom.lexus.com/releases/lexus+crafting+new+approach+customer+relationships+march12 8 http://pressroom.lexus.com/releases/lexus+crafting+new+approach+customer+relationships+march12 5
http://www.autoblog.com/2013/03/14/satisfaction-with-dealer-service-rises-lexus-and-gmc-are-tops/ 6
THE AUDI EXPERIENCE Given the problems internationally, with the Audi brand and its parent VW, it is surprising that Audi meets the average standard for customer service in the USA, according to the above survey. However, in the luxury car market, is average good enough? The opportunity exists for a repairer, to exceed the Audi driver s previous service experiences and therefore delight them with their repair experience. For Audi drivers who have previously had dealings with Audi Australia, it seems that Simply Smashing needs only to exceed that customer s prior lowly service experience to have serviced these clients well it seems that the Audi Australia customer experience has the effect of lowering expectations something that an approved repairer could take advantage of, through a competent and smooth repair process. This could be hampered by some of Audi s company policies, particularly their warehousing of spare parts. This needs to be kept in mind when making service promises to Audi customers they have been promised before and left unsatisfied. And should Simply Smashing make promises based on a usual timeline, the promise may well be frustrated by issues with the car manufacturer that are out of Simply Smashing s control. AUDI SPECIFICATIONS FOR REPAIR One good thing about Audi is that it has workshop mechanical and collision repair manuals available online, and not necessarily for a price. The following shortlist of Audi recommendations can be confirmed in current Audi Collision Tooling guides. - Use only original Audi Parts - Use only Audi approved tools equipment and procedures. - Vehicles must be placed on a repair bench system approved by Audi AG and measured. A list of approved frames is provided in the Audi Authorized Collision Repair Facilities required Tool and Equipment Guide. - Celette and Car-o-liner are included in Audi approved equipment lists. - Audi prefer DuPont paints. - Audi recommends I-Car certification of repair technicians. 9 Other repair protocols and a guide to other approved equipment can be found in the Audi Collision repair guides and tool catalogs provided with this report. 9 Audi Authorized Collision Repair Tool Catalog page 2. 7
THE LEXUS EXPERIENCE Lexus has traded on the following slogans 10 : 1: The relentless pursuit of perfection. 2: The pursuit of perfection. 3: Engineering the impossible. The most recent tagline (3) seems to overpromise. Tagline (2) undersells the product in that it implies that the pursuit will one day end especially when compared to the first slogan. The most memorable of Lexus s taglines is the first and this is what Lexus buyers have come to expect: maybe not perfection, but at least a desire to reach for perfection in a motor car build, and to keep striving without ever giving up. It is this belief that most Lexus buyers bring to any dealing they have with service providers regarding their vehicle. Lexus names their customer service protocol The Extraordinary Way. Lexus claims that The Extraordinary Way employs unconventional methods to achieve uncompromising results. 11 As with most marketing hubris, there is some gap between what is stated and what is achieved. It seems to be the consensus that while Lexus do indeed achieve to a high level, they do not necessarily employ unconventional methods and they certainly are quite strict in ensuring repairers methods do not stray outside of Lexus guidelines. Lexus Customer Expectations: All I want is a good product and a fair deal. I don t mind paying a premium, but it must be right. 12 10 http://www.autospies.com/news/lexus-replaces-pursuit-of-perfection-tagline-with-engineering- The-Impossible-Smart-Move-54774/ 11 http://www.lexus.com.au/about/theextraordinaryway 12 http://www.lexusownersclub.co.uk/forum/topic/74477-customer-experience-feedback/ 8
LEXUS SPECIFICATIONS FOR REPAIR Lexus keeps their repair specifications strongly under lock and key. While collision repair manuals seem to exist, they are extremely difficult to access on the web without purchasing them through an officially-endorsed Lexus channel. However, small details regarding Lexus s standards of collision repair are available from other sources. Following is a list of Lexus s stated repair expectations: - Use only original Lexus Parts - Use only Lexus approved tools equipment and procedures. - Use only Lexus approved paint and spray booth down-draft paint booth 13 - Lexus approves Celette Unibody correction equipment - Lexus insist on repairers attending Lexus collision repair and refinishing training 14 - Lexus training includes Lexus certified technician hands-on training and rigorous exams 15 - Insist on I-Car training specific to Lexus repairs 16 - Free 24 hour rental car preferably a Lexus 17 - Maintenance and repair histories completely documented and recorded on computer 18 - International standards for Lexus are for a 24 month / 40,000 kilometre warranty on repairs, both mechanical and collision. 19 - Lexus has extremely high standards for chassis repair and expects collision repairs to be carried out according to Lexus specifications, to the letter. For example, Lexus make much of their reinforced steel chassis zones: The 2013 Lexus GS Body Structure has an exterior weight reduction through a combination of aluminum alloys, high-tensile strength steel, ultra high-tensile strength steel and hot-press steel. Repairs made to the various steel structural components within the Lexus GS must be made at precise temperatures, using specific welding techniques and properly monitored combination of heat application or risk substantially reducing the passengers safety and structural rigidity of the vehicle. 20 13 Collision Pros parts and repair organisation support page 3. 14 www.awcollision.com.lexus.html - the same for all recommendations to this point on this page. 15 www.lccc-online.com/owners/faq.php 16 http://www.i-car.com/html_pages/training_programs/oem_training/lexus_training.shtml 17 http://www.motorcarsintl.com/services-bmw-repair-atlanta/lexus-repair-atlanta-maintenance/ 18 http://www.motorcarsintl.com/services-bmw-repair-atlanta/lexus-repair-atlanta-maintenance/ 19 http://www.motorcarsintl.com/services-bmw-repair-atlanta/lexus-repair-atlanta-maintenance/ 20 http://www.awcollision.com/lexus.html 9