In today’s economically turbulent times, new car buyers want the security of a “lifebelt”, according to Chevrolet UK managing director Mark Terry.
Go deeper with GlobalData
Keen to build on the [GM-Daewoo supplied] brand’s success through the now ended scrappage scheme, Terry said customer research at the end of 2009 indicated buyers didn’t just want a cheap car, they also wanted brand security. This led Chevrolet to announce its ‘five year promise’ last week.
This is five years of new vehicle warranty, servicing, roadside assistance, annual vehicle health checks and MoT cover [the UK safety and emissions test mandatory annually from three years on]. The package is also transferable to subsequent owners who qualify for remaining cover.
Terry said: “Our research indicated the post recession is probably going to feel more like a recession than it was last year when the scrappage incentive was brought in and softened the landing, so to speak.
“People who have a disposable income have told us they will spend on something if they feel they are getting value for money. Customers want to feel very confident about a brand and as a result we introduced the promise to show them we are here for them after the initial purchase.”
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalDataTerry said other manufacturers offered extended warranties and had seen sales rise. Rivals also offer various service packages but they either cost extra or are more limited than the Chevrolet offer.
“Put simply, no one else is doing what we have said we will do,” he added. “We want customers to know they can count on us and we are stepping up to meet customer requirements.”
There is also another element to the new support package. It demands dealers work harder to keep customers happy, if they want to retain lucrative service business, but it will also help boost residual values.
Terry joined Saab in 1987 after an earlier career in engineering and sales and, after rising to operations director, left in 2008 to head Chevrolet UK.
He sees the new deal as particularly attractive to private buyers who have bought 1,000 more cars so far this year than last, accounting for a larger percentage of Chevrolet registrations in the UK.
Overall, though, there is work to do. In a UK passenger car market up 10.8% to 195,226 units in June and almost 20% to 1,108,662 in the first half of 2010, Chevrolet volume was off 53.5% to 1,117 cars last month and 9.6% to 7,947 year to date, according to SMMT data.
The brand nonetheless hopes to do better than 2009’s 18,600 sales but how much better is likely to be down to the success, or otherwise, of that five year promise.
