Survey Shows Consumers Trust Auto Dealers, but Transparency Plays Critical Role in Sales Process

Safety plays critical role in consumers’ desire for dealership transparency; failure to disclose open safety recalls can impact sales

Automobile shoppers say automotive retailers’ transparency is a critical part of building and maintaining trust in the sales and service process, according to a recent survey commissioned by AutoAp, Inc., and Rapid Recon.

“Consumer Transparency Expectations” found that consumers still trust automobile dealerships — new car dealers scored 80% when consumers were asked to rate trust, while transparency rated 92%, with 100% being extremely important.

However, the survey also found that dealerships who do not disclose vehicles with open safety recalls will lose customer trust, future sales and potential referrals. When asked if they would purchase a vehicle from a dealership that failed to disclose an open recall, consumers’ average response was 7.5%, with “Not at All Likely” equating to 0% and “Extremely Likely”, 100%.

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“Dealer Transparency is required for Consumer Trust.”

The survey included responses from 1,000 people across the country who will be in the market for a new or used vehicle within in the next three years and plan to buy at a franchised or independent dealership. The survey sought to measure several key attributes including how highly consumers value transparency, how much they trust auto dealers, and how vehicle safety recalls can impact the vehicle sales process.

Brad Preble, CARR Auto Group’s President said: “For dealers to be even more successful, it is essential that they embrace innovative ways to provide critical information to customers leading up to and at the point of sale. Safety recall management systems can significantly strengthen customer relationships and help close more sales. If a dealer can remedy a known recall before they sell, it increases their likelihood to close the sale.”

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Approximately 20-25% of all vehicles on the road have one or more open safety recalls. And through previous research, AutoAp found that Franchised Dealers have an ‘open rate’ of 14.8% while Independent Dealers have an open rate of 20.3% – about the same as consumer-owned vehicles. These vehicles are often sold, unknowingly to both the dealer and the customer, because of errors and delays in the vehicle recall ecosystem. Without an automated vehicle recall management system, it’s difficult to stay on top of – let alone ahead of – safety recalls.

“Dealer Transparency is required for consumer trust. It’s simple: Dealers who work to win and maintain trust sell more,” said Mark Paul, CEO of AutoAp, Inc. “Disclosing vehicle safety recalls is a critical element of transparency.”

The survey also shows that consumers are overwhelmingly more likely to purchase vehicles from dealerships with an automated process to identify and manage vehicle safety recalls versus one that does not (95% versus 5% – factor of 19 to 1).