19 March 2012

After last week’s move by Vauxhall to introduce a second, lower, labour rate for older car servicing, which I was somewhat sceptical about, it turns out I’m not alone.

Following on from my chat to Peugeot’s managing director Tim Zimmerman this week about the brand’s position in the NFDA Dealer Attitude Survey , I asked about labour rate structures. He didn’t want to comment about another make’s position, but did spell out how the French marque sees things.

Mr Zimmerman pointed out that it was difficult to justify a different labour rates for two cars if they are identical apart from their age (especially if the age is 2.9 years and 3.1 years) when the same technicians are carrying out the same work using the same equipment.

He made an additional point. Mr Zimmerman believed that retail customers were smart enough to know when price was important and when the technician’s skills mattered most.

His view was that all franchised retailers needed to be competitive with fast-fit businesses on the simpler and most common work such as brakes and exhausts. However, he also believed customers knew that for servicing work the best place was a franchised retailer.

What I’d like to know now is what you, the retailers, think of each approach and which works best. Get in touch and let me know.

Tristan Young
Editorial Director

Drop me a line at tristan@auto-retail.com

Tags: discount, fixed price, Peugeot, pricing, servicing, two-iet, Vauxhall, Zimmerman