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Jeep five-year warranty 'not a silver bullet'

Tough going: Jeep is ramping up its customer care to try to reverse negative sentiment among consumers about the American brand.

FCA boss says longer warranty only one step in turning Jeep around

24 Feb 2017

FIAT Chrysler Automobiles (FCA) Australia admits its new Jeep aftersales customer care scheme that includes a five-year warranty is not the complete remedy for Jeep’s falling sales and reputation in this country, but only the essential first step.

Speaking to journalists at the Alfa Romeo Giulia launch in Port Macquarie this week, FCA Australia president and CEO Steve Zanlunghi declined to elaborate on the next phases of the customer care commitment drive, other than to say further plans were afoot to restore consumer faith in Jeep.

“This isn’t some silver bullet that we think is going to drive sales,” he said.

“This is to build a foundation for the Jeep brand so we could grow and grow sustainably going further.

“And I think we have hit the mark here. But ultimately it will be the customer that tells us whether it works or not.

“We are not done. These are just a few of the things we are doing. We’re going to constantly evolve this program, because once it’s out there it is a big responsibility to live up to.

“This isn’t just a three-month program. This thing is going to evolve over time. We already know what phase two and phase three is going to look like throughout the year and into next year.

“We’ve got it drawn up where we think we’ll shift, but it’s going to be up to the general public and how they react that’s going to determine which direction we are going to go.”

As widely predicted last year, all 2017 Jeeps sold from Friday February 24 are covered by a five-year warranty. Dubbed the There and Back Guarantee, the scheme is transferable, includes annual instead of six-month service intervals, and comes with free roadside assistance for the life of the vehicle as long as it is serviced within the Jeep dealer network.

The program is also available for MY15 and MY16 models for $1950.

Mr Zanlunghi revealed that six months of real-world research was done to identify core issues and determine what would get buyers back into the fold.

The evidence pointed to perceptions of poor quality and reliability, high costs of ownership and off-road vehicles that might be unsuitable for urban use.

“(Our research found that) Aussies want Jeep to back itself,” Mr Zanlunghi said. “Things like ‘Jeep is credible in capability but not reliable’… ‘Jeep is hardcore but not relevant everyday’.

 center imageLeft: FCA Australia president and CEO Steve Zanlunghi.

“That general negative sentiment signifies concern… (such as) ‘how can I be sure that Jeep will look after me if something goes wrong?’ And while service (costs) are inevitable, Jeep should make life easier not harder.

“I’ve heard a lot of people talk about negative experiences, and this was a key driver for us working in the background.”

Mr Zanlunghi said that fixing Jeep was his most important priority when he began his tenure in Australia on August 1 last year.

“I arrived here about six and a half months ago and saw the Jeep brand where it was, but not where we wanted it to be, especially after seeing where Jeep was in some global markets,” he said.

“So, in 2016 we made a commitment to focus on customer satisfaction and reducing the cost of ownership. These are things that we saw that prevented Jeep from being where it needed to be. We implemented a wide range of new processes and streamlined others.”

Some of the behind-the-scenes actions included dealer service coaching, reduced parts prices, direct shipping of parts from FCA’s warehouse to dealers in Melbourne, Sydney and Brisbane, a 200 per cent increase in parts warehouse inventory, more FCA field teams working with the dealer network and a 50 per cent increase in FCA customer care staff.

Mr Zanlunghi said that since these and other measures had been implemented, FCA’s aftersales customer satisfaction index had improved 35 per cent, while the fixed-first time index had improved 18 per cent compared to the second quarter of 2013.

“So we are making strides,” he said. “And if you look at our aftersales customer satisfaction, we are now on par or better than the major national sales companies in Europe as well, but sometimes it takes a while for perception to catch up with reality.”

Mr Zanlunghi revealed that Australia is the only factory-backed Jeep market to offer this level of customer care.

“We will be the only wholly owned national sales company with a five-year warranty for Jeep, and the reason is because of the perception that we have,” he said.

“It was clear that we needed to do something to give assurance to the Australian public that ‘hey, we are there for you the customer come in we do back ourselves.

“And Australia is extremely important to our global product plan, because without Australia we don’t have RHD vehicles.

“You need the UK and Australia in order to have a RHD portfolio. That allows us to build cars for Japan, South Africa and some of the other RHD markets.

“So senior management understood the reason for it, they understood the concept, and then we had to build the program and then bring it to them for final approval and it was an easy sign-off for them.”

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