Dealer Incentives

Here is an article I came across on Mazda's dealers lawsuit regarding incentives from Mazda. It is from 2018 and I have no idea of the current status.

 
Here are 2 extracts from Mazda's 2018 Financial Statement (ended March 31, 2018) regarding changing the dealership network and experience. I wonder if this program is what drove the lawsuit.

In sales, we promoted “right price” sales by emphasizing our brand value, and took steps to enhance trade cycle management by improving residual values. In these ways, we strengthened our sales capabilities globally. Moreover, we promoted sales network reforms in the United States and other countries to improve customer care and launch new-generation dealerships.

Mazda is aiming to build a U.S. sales network that can sell 400,000 units per year in 2021. To that end, we will promote qualitative growth through higher brand engagement and medium- to long-term quantitative growth, and will reinforce investment in realignment of the sales network.

Looking back at our initiatives to date, over the two-year period from 2016 we worked to reestablish our sales network based on Mazda brand value management. The objective of these initiatives was to increase the quality of dealerships, so that our locations and staff create exciting venues that draw customers who look forward to engaging with products that they truly want. Specifically, we implemented a conversion to strong dealers who endorse Mazda’s brand value management, and began to establish next-generation branded dealers. In addition, we created a roadmap for the reestablishment of the optimal sales network in 35 priority markets. Results to date include steady improvements in repurchase rates, sales of certified pre-owned vehicles, service retention, and dealer profitability. Business quality is improving. We will continue working to improve the customer experience through enhanced training for dealer staff and trade cycle management initiatives. In these ways, we will improve residual values, keep incentives in check, and achieve “right price” sales. Over the period to 2021, we will execute network enhancement and focus on growth in priority markets. Specifically, we will expand to 300 next-generation branded dealers, mainly in 35 priority markets. We will also strive to achieve an average of 1,000 unit sales per year among next-generation branded dealers and a repurchase rate of 55 percent in 35 priority markets. At the same time, we will overhaul our marketing strategy and roll out a strategy that addresses the characteristics of each market.
We will implement these initiatives and accelerate the construction of a U.S. sales network that can sell 400,000 units per year by 2021, when the U.S. plant will start operations. In these ways, we will advance quantitative growth over the medium to long term.

The lawsuit was in the Fall of 2018. I searched Mazda's 2019 financials for "lawsuit," "suit," "litigation" and "legal" and found no relevant references, so this might have been resolved out of court. I also found these references to the dealership program being rolled out in July 2018 that caused the lawsuit:

We are advancing the roll-out of new-generation dealerships in Japan as bases for learning about and experiencing the Mazda brand. By the end of March 2019, this upgrade had been completed at 165 dealerships. Moving forward, we will continue working to offer a distinctively Mazda customer experience that serves to foster customer satisfaction. We are working together with sales companies to promote activities that further enhance customer service so that customers continue to choose Mazda after they make a purchase. To that end we are working to see that dealership staff can perform their duties with pride and emotional attachment to the Mazda brand.

Mazda is advancing measures to rebuild its sales network in the United States, and we are taking steps to support the implementation of dealership management based on “appropriate dealership owners” in “appropriate locations” with “appropriate facilities.” Specifically, we have worked to promote investment in next-generation branded dealers. In July 2018, we introduced an incentive system that pays sales incentives to dealers based on the extent to which they meet high brand standards and on the level of customer satisfaction. Since the introduction of this system, we have seen an increase in the number of dealers that have signed up to invest in becoming next-generation branded dealers, with the total reaching 265 dealers at the end of March 2019. We are making steady progress with plans aiming for expansion to 300 of these dealers in 2021. At the 65 dealers that have already completed the transition to next generation branded dealerships, the average annual sales volume has been steadily rising. In addition, this initiative has led to improvements in business quality, such as improved repurchase rates and increases in dealer profitability.

It looks like whatever resolution was reached, it did not kill the program. Nor are there any references to significant modifications. But this is an assumption based on not seeing something.
 
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It seems the have resolved the issue and moving forward for better market and customer experience in the US.
 
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