Customer satisfaction and good product is key to success: Steve Zanlunghi
FCA Boss, Steve Zanlunghi is realising his ambition to bring Jeep, Alfa and Fiat back to glory in Australia by focusing on product and the customer.
WHEN STEVE ZANLUNGHI took over FCA Australia as President and CEO in August last year the brand was beginning to settle after the doings of past management teams had been eviscerated by the local media. An Australian national, Zanlunghi joined FCA back in 1987, was named managing director of FCA UK and Chairman of FCA Ireland in 2012.
Then, in February 2015, he was named Head of Jeep Brand – Europe, Middle East and Africa. Mr Zanlunghi maintained his responsibility for the UK and Irish markets. And in August 2016, he was named President and CEO of FCA Australia.
Commenting on the appointment, Asia Pacific Chief Operating Officer (COO) Mike Manley, said: “I’m delighted to be making this announcement, as it further strengthens our APAC team and sees one of our senior executives appointed to lead a key market for us. Steve is not only a capable leader, but he also has a good understanding of the Australian market place.”
Once taking up his seat in Australia, Mr Zanlunghi immediately began working with the local outfit to return the brand’s focus onto the customer and their experience of FCA brands from buying through to ownership.
This was explained when Practical Motoring spoke with FCA’s head of aftersales, Stéphane Lamari, earlier this year, he outlined FCA’s growing commitment to the customer. Since 2016, the people selling and working on FCA product have been given improved training to ensure vehicles are fixed right first time, with many Jeep dealers now recording scores of up to 97%, which Lamari said was equal to the best dealerships in the US.
Another issue, Lamari identified was a lack of stock control, implying the brand had grown very quickly and didn’t have the back-end infrastructure to support the customer as it grew.
“The growth here (in Australia) was very quick and the background (establishing a well-stocked and efficient spare parts network) was not set, and so if you have a little problem but it takes me three months to fix that problem, it is no longer a little problem and it is a big one,” he told Practical Motoring.
“The thing that has been address is logistics, I think we have one of the best in the country; we have a 96% fill rate, and this with only one big warehouse in Melbourne. So part availability is not an issue and 70% of my costs are air freight. So we are air freighting parts where they are not available (at the dealer) to ensure the customer has mobility.
“There really shouldn’t be a wait because I’ve got the stock. But if it’s a specific part, maybe five days (to air freight from Italy), he said.”
This week, Practical Motoring sat down with Steve Zanlunghi to talk about quality issues, customers and future product… pay close attention to that part and read between the lines.
Jeep is a brand that’s every bit as iconic as Land Rover’s, but do you think poor service experiences and quality issues have tarnished the reputation?
We know we have great product, and we know our dealerships work hard to deliver great customer experience, not just for new car buyers but our owner base too. When you buy a Jeep, you’re buying into a lifestyle of adventure and freedom, we want the ownership experience to embrace that in all its aspects.
Jeep is considered by many to be a true 4×4 brand, so, why was the decision made to make the current Grand Cherokee an MA passenger vehicle, and not an MC off-road passenger vehicle?
We answered this question last week. Click HERE to read about how Jeep has reclassified the new Grand Cherokee as an MC off-road passenger vehicle.
Given that Australia’s is fast-becoming an SUV-first market, do you think this plays into Jeep’s strengths going forward?
Absolutely. Our brand values are similar to those that Australians exemplify, such as freedom, passion and adventure.
And, can the brand overcome some of its past issues and the get attention back on Jeep’s products for the right reasons?
We’re already doing that. Perception lags reality. Our customer satisfaction scores have already increased by 35% in the last year and are already on par with some of the top performing European national sales companies.
The fact is, product is king. If you have a good product it helps perception catch up to reality a lot faster.
Is there a type of vehicle not currently in the Jeep line-up that you’d like to see?
We have seen strong demand since the introduction of the Gladiator concept and I think a Jeep ute would do well here in Australia, especially given the size and popularity of the ute segment.
Will Australia ever see a seven-seat Jeep Grand Cherokee?
Can’t talk about future product, but personally I do see space in the Jeep line-up for a seven-seat passenger vehicle.
Have you had much feedback from customers that’s shaped how the brand deals with issues going forward?
Listening to our customers is crucial if we’re going to make the ownership experience the best it can be. They are at the centre of everything we do and we’ve already made significant inroads in improving customer satisfaction and the way we handle our customers that may need assistance, as I mentioned earlier.
Alfa seems to have a new lease on life with the arrival of the Giulia and the soon-to-get-here Stelvio, can they kick-start sales for the brand here in Australia?
As I mentioned earlier product is king. This is a platform and two vehicles that will elevate the Alfa Romeo brand to heights that haven’t been seen in recent years. These vehicles were designed to stand out in a crowded premium segment, and they will thanks to the designers and engineers in Italy who’ve done everything they can to help us be successful. Now we need to capitalise on their great work. And now that our local team has finally seen and experienced the new generation product, it has given us a great sense of motivation.
Do you think the Stelvio will become Alfa’s best-seller here and around the world?
I can’t talk for other countries, but in Australia it certainly has that potential. The SUV share of industry continues to grow because Australians love their practicality and versatility, and they particularly like dynamic driving SUVs.
We’ve already seen the premium mid-size SUV segment grow 35% since the Stelvio project was approved. We expect it to continue to grow. There are a lot of good vehicles in that segment, and we think we will have a very compelling product.
There are rumours that the MiTO and Giulietta won’t be renewed going forward, will this hurt the historical impression of Alfa as a ‘car’ company?
We can’t talk about future product. But what I can tell you is that the Alfa Romeo brand will be competitive in the segments it competes, especially at a product level.
And, will these models be replaced by a compact SUV to sit beneath the Stelvio?
I can’t comment further than what has already been announced at our 2015 shareholder meeting.
Is it conceivable that Alfa will become an SUV company with a hero car (Giulia), rather than a car company with a hero SUV?
Alfa Romeo’s brand has been 107 years in the making, and it’s built on performance, fun driving, good handling, lightweight. The Giulia is the latest in a long line of vehicles faithful to that heritage, and we have plans to pursue that even further. Just because we build an SUV doesn’t change our heritage or our brand image. And even if we sell more SUVs than sports sedans, this won’t change.
Let me give you an example: How does the world view Porsche these days? A company best known for the 911 coupe, but 85% of its volume comes from vehicles with four doors, predominantly SUVs. To me it’s still a sports car company, and a successful sports car company at that.
With Mercedes-Benz announcing it will build a ute (albeit based on the Nissan Navara) would Alfa ever consider a ute, or is that one segment too far?
We’re trying to stay true to Alfa’s heritage and brand values. I don’t recall a time in the Alfa Romeo history of there being a ute. In our five-year plan there is no mention of a ute.
Locally, what are the key issues the company needs to address to win back customer confidence? It already seems to have started with its There and Back scheme, and we’ve heard how customer service and vehicle servicing is being revamped.
The There & Back Guarantee is one piece of the foundation to win back the confidence of the Australian consumer. It is by no means a silver bullet, nor is it meant to be. It shows that we are willing to back our products, and that we have made inroads both as a company and as a dealer network prioritising customer satisfaction. This is going to constantly evolve until we are one of the best in our industry. And even then, we will try and better it.
If you could gaze into a crystal ball, where would you like to see both Jeep and Alfa in Australia in five years?
Jeep’s brand values as I mentioned earlier resonate well with the Australian spirit. Alfa Romeo was once a top premium brand here in Australia, which is what we are pushing towards again with the massive investment we have made in our products and our dealer network.
It’s up to us to get the product and the ownership experience right, and success will follow. We’ve already made significant inroads in both those areas, and we will continue to improve our performance, year after year.