The chairman of the FCA National Dealer Council said dealers need "decreased complexity and increased consistency" in their dealings with Fiat Chrysler as the automaker and its dealers work in an era of plateauing sales.
Jon Gray, owner of the three-store Orange Coast Auto Group in Costa Mesa, Calif., said the complexity-consistency mantra applies to most areas of dealership operations: from fixed operations to sales and hiring to stair-step incentive programs.
"Decrease complexity, increase consistency -- that's my mantra," Gray said. "I just get back always to, if the program is easy to understand -- hence the decreased complexity -- and it's consistent, so that dealers know what to expect month to month, that gives the dealers, no matter where they fall in their taste for [stair-step sales incentive programs], the ability to make a go of it."
Gray said FCA dealers had a good year in 2016, but steady sales gains slowed or stopped as overall U.S. auto sales plateaued.
"We've leveled off at a pretty nice number, but leveling off feels different, like when you level off in an airplane," Gray said. "We've now found the level [the market is] going to bounce around in, and we have to figure out how to work within that space. That's going to take a different discipline -- a discipline for OEMs as well as for the dealers."
Gray said FCA's National Dealer Council will continue to discuss the automaker's stair-step sales incentive programs. But he left no doubt that FCA's Volume Growth Program has worked, and that he supports its main proponent, U.S. sales head Reid Bigland.
"I believe in Reid. And the dealers believe in Reid. If you look at the growth of FCA, it's hard to argue that the retail strategy hasn't worked with VGP," Gray said. "But with that said, there are serious conversations at [the dealer council] about the impact that the program can have on rooftops."
In terms of product, Gray said a planned luxury Jeep three-row SUV, the Grand Wagoneer, would be a welcome addition in his Southern California market. He also said plans by FCA to expand Wrangler and Ram production will bring more of those sought-after vehicles to dealer lots.
"Since consumer demand seems to have shifted to the crossover-SUV space, that happens to land kind of exactly where it needs to land," for FCA dealers, Gray said. "We have product to fill that."