Major car company 'forcing' customers to start paying for vehicles that haven't been delivered
Company denies fining dealers
Buyers of cars from the Stellantis group, the automotive conglomerate that includes Vauxhall, Peugeot, Fiat, Citroën and others are currently being forced to pay for new vehicles that they have not yet seen.
According to Car Dealer magazine, Stellantis dealers have been reporting that they have been threatened with losing their allocation of cars as well as their end-of-year bonuses if they do not register vehicles before they arrive at the dealerships.
The knock-on effect for customers is that unless buyers agree to their cars being registered before they reach dealerships, and to hand over several months’ worth of finance payments as well as tax and insurance, they run the risk of their order being cancelled.
“This is all down to logistics and not being able to get the cars to dealers,” said the boss of one dealer group who asked to remain anonymous for fear of repercussions from Stellantis.
“They are forcing us to register cars that we know are going to be three months away and it’s a very awkward conversation to have with customers.
“We had one customer who had paid three finance instalments on their vehicle, and they still haven’t seen it.”
“This used to be normal practice to register cars that hadn’t arrived,” said another dealer, “but you knew they’d be with you in three to five days. That’s simply not the case any more. You just don’t know when you’ll get the cars.”
Another dealer who branded the situation a “s**tshow” said that the debacle was just as unpleasant and awkward for dealers as for customers.
“The conversations with customers are just embarrassing,” they said.
“We’re having to tell them that if they don’t agree to us registering the car they’ll potentially lose it completely.
“Some of these customers have been waiting months for them, so they don’t want that. It’s terrible behaviour and not something we want to be doing.”
“The conversations with customers are just embarrassing”
Yet another dealer slammed Stellantis’ behaviour as “short-sighted”.
Although the car industry is showing tentative signs of recovery from its post-pandemic nadir, during which production was throttled by a combination of supply-chain issues including the global semiconductor shortage and the war in Ukraine, the Stellantis situation is a clear sign that all of those issues have not yet been resolved and buyers still face significant wait times for new cars.
Adding to this in Stellantis’s case appears to be an inability to get cars to dealers once they do eventually arrive in the UK, with dealers being told to “go and pick the cars up from the ports themselves.”
“That simply doesn’t work,” said one Stellantis dealer.
“We can’t go and pick up individual cars. They need to get their transport sorted out and get these cars to dealers.
“Fines have been issued [for uncollected cars] and then ‘held’ after dealers hit back with legal papers.
“Cars have been removed from customers, which has left some extremely disappointed. Customers are being pressured to register cars, as dealers cannot afford to have the fine or lose the car.
“If a car is taken off a dealer, any replacement order is not price-protected, either, meaning the customer is financially worse off.”
The accusation that Stellantis has been fining dealers has been strongly denied by the company’s senior vice-president and group managing director, Paul Willcox. However, speaking to Car Dealer in a follow-up interview, Willcox did not deny most of the other of the claims made by dealers.
Willcox explained that it was necessary to register cars “in the system” (i.e. stuck in ports or not yet delivered to dealers) in order to secure future allocation of new car slots from factories next year.
“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.”
European factory supply, said Willcox was based on how countries were managing their “stock balancing”.
“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.”
Willcox said that while dealers had been told to collect cars from ports themselves, they had been offered a financial incentive to do so. He admitted that the situation was sub-optimal and that the company was aiming to have it resolved within the next four to six weeks.
Addressing the issue of dealers being forced to register cars before they have arrived, Willcox said that it has caused “tensions in the network” and that the he was working to fix a plan which appears to have backfired as a result of supply-chain hold-ups.
“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.”
A “perfect storm” of transport issues has, he said, curtailed Stellantis’s ability to get cars from ports to dealers including, the company suggested, a shortage of lorry drivers as a result of the war in Ukraine.
“This is not about us being heavy handed with dealers or trying to improve our financial situation,” said Willcox.
“This is about us wanting to get more stock, more supply and to ultimately reduce lead times for our customers.”
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