J.D. POWER SURVEY OF DEALER ATTITUDES IS FLAWED, NADA SAYS

The National Automobile Dealers Association is at odds with a survey that measures dealers' attitudes toward manufacturers.

NADA said the J.D. Power and Associates 1994 Power Dealer Attitude Survey, released Dec. 14, contains several inaccuracies. The dealer group also is concerned about the methodology used by Power.

J.D. Power is a marketing research firm in Agoura Hills, Calif. Its automotive surveys are often used as industry standards.

'We have an ongoing interest in keeping the facts straight about our industry, and NADA's dealer surveys do not support many of the findings in the J.D. Power and Associates survey,' NADA President Bill Dodge said.

A QUESTION OF ANSWERS

Steve Goodall, senior partner at J.D. Power, said the discrepancies in the survey findings are due to 'subtle, but fundamental differences' in how the surveys are conducted.

He said the Power survey is sent to the dealer principal or owner/operator of the dealership, and 90 percent of the respondents identify themselves as such.

The NADA surveys, Goodall claimed, are sent to the dealerships and are usually answered by general managers.

Not so, said Jake Kelderman, NADA industry affairs director. Kelderman said NADA surveys are also directed to the dealer principal or owner/operator.

'We ask them to consult with their managers before filling it out,' Kelderman said.

NADA, which conducts its own dealer attitude surveys twice a year, said:

The number of franchises held per dealer principal increased between 1992 and 1994. Power reported that the number declined. Power also reported that the number of franchises per dealership facility declined; NADA said that number held steady.

Power said the number of dealership facilities held per dealer principal declined from 1989 to 1994. NADA said the number increased during that time.

Power's findings indicated that the number of dealership employees decreased between 1989 and 1994.

NADA said the number of dealership employees increased between 1989 and 1994. NADA also said the number of dealership employees is at a record high, as are the dollar sales generated per employee.

Advertising expenditures did not decline between 1988 and 1993, as reported by Power, but rather increased and are at record levels on both per-dealer and per-dealership bases, NADA said. The association said dealership advertising, as a percent of sales, is down from the 1988 peak, but it said that number is misleading because it does not include significantly increased dealership outlays to dealer co-op ad associations.

TOO MANY DEALERS?

NADA also took exception to a point Power made about the industry being 'overdealered.' The Power study said the industry has been 'right-sizing' itself during the last seven years.

Kelderman said the industry is always right-sizing itself.

NADA said it has concerns about the size of Power's sample. While Power said its survey is based on results of returns from 4,163 dealer principals, NADA said there is no indication of how many surveys were sent out and how many were 'usable.'

You can reach Arlena Sawyers at asawyers@crain.com

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