7:27 am, December 15, 2022
Stellantis says its dealers have been pushed to register cars that haven’t arrived in showrooms in an attempt to secure future production capacity at factories.
Paul Willcox, senior vice president and group managing director at Stellantis, told Car Dealer that fixing these issues was his ‘number one priority’.
He admitted that the demands Stellantis has made has caused ‘frictions’ with dealers, but said he believed they were ‘done for the right reasons’.
Yesterday, Stellantis dealers revealed they had been forced to ask customers to register and pay for cars they hadn’t actually received yet.
They said some Stellantis new car buyers have been forced to pay three months’ worth of finance instalments, insurance and tax on new cars they haven’t even been able to collect.
And the anonymous dealers said Stellantis had been asking them to register cars that are still in ports waiting to be delivered and, in some cases, still on ferries.
A shortage in transport trucks have meant many cars are stuck in ports and unable to get to dealerships.
Willcox said these extreme measures were needed as Stellantis looked to improve its ‘stock turn velocity’.
He did not deny the majority of claims made by Car Dealer’s sources, but did take issue with the accusation Stellantis was ‘fining’ dealers that did not comply, saying this was ‘not true’.
However, he didn’t comment on whether bonuses were being withheld for franchisees that didn’t comply.
Willcox explained that registering cars ‘in the system’ [stuck in ports] was needed as he looked to secure future capacity of new car stock from factories for next year.
He told Car Dealer: ‘The reason we’ve done that is we’re pushing hard to get more supply within the overall production portfolio because we want to get a bigger slice of cake for our UK retailers.’
Willcox said European factory supply was based on how countries were managing their ‘stock balancing’.
He added: ‘If you have lots of stock on the ground, then there’s less chance you’ll get more supply in the future because the view is you have got stock.
‘So we’ve put a lot of pressure in our organisation internally on trying to improve their [dealers’] stock velocity.’
Stellantis dealers revealed they had been told by the manufacturer that they could go and collect customer cars stuck in ports themselves.
Willcox said dealers had been ‘offered a financial incentive’ to do this and that the manufacturer ‘saw this as a positive’.
Dealers have branded it ‘unworkable’.
He said: ‘If dealers want to self collect, we can arrange that kind of deal, but in limited numbers.
‘We can’t have 500 single trailers coming up to compounds as that would be chaos, but we did give that opportunity to retailers to do that, rightly or wrongly, and we thought it was a positive thing.’
Willcox said fixing this issue was his ‘number one priority’ and that in hindsight he would have tried to tackle it differently.
He said: ‘We now have the situation you’ve identified that, obviously, some of our retailers have shown some frustration. We recognise that we’ve got to work our way through that.
‘We don’t think it’s a long-term issue, we think it’s something we will resolve within the next four to six weeks.
‘We’re working furiously at the moment on this. I have to say this is number one on my agenda beyond anything else today, and I’ve got lots of things on my agenda.
‘We’re going through a network restructuring at the moment too which is very challenging. We’re losing partners, which also causes friction in the business.’
Willcox said for customers who had been affected by policies to register cars before they have received them, Stellantis was looking at offering them ‘mobility solutions’ centrally from head office. He didn’t expand on what these were.
But he admitted the whole issue has caused ‘tensions in the network’ and stressed he was working hard to resolve it.
‘We have three meetings a day about this,’ he told Car Dealer.
‘We wanted to position the UK as a very clean, low stock market so we could secure more supply. And that’s put us in the situation.’
He branded the current issue a ‘perfect storm’ as transportation issues have severely hampered getting cars from ports into the hands of car dealers.
‘This is not about us being heavy handed with dealers or trying to improve our financial situation,’ he added.
‘This is about us wanting to get more stock, more supply and to ultimately reduce lead times for our customers.’
