July 2020 – Automotive remuneration trends

With the new financial year now upon us and last year’s group certificates starting to make their way out to employees, now is often the time that requests for a remuneration increase are made. For some dealerships, they will take ownership of this common occurrence and conduct their own reviews of the market trends, and then compare against their current remuneration packages and the employee’s performance.

The following summarises automotive remuneration trends that we have observed over the last year. These figures are based on our observations, discussions with dealers, candidates, and assignments undertaken over the last 12 months. These figures are expressed more so in terms of averages. There can be a dramatic difference in base retainer for the same role in Melbourne, versus Brisbane, rural versus metropolitan, so for a more precise guide, attention would need to be paid to location, brands, volume and more.

Fixed Operations Manager – Salaries tend to fall between $80,000 to $120,000 + superannuation and a vehicle. Depending on the size of the operation, an earning capacity of around $150,000 + is common, certainly in the higher volume centres. Incentives often consist of multiple, mixed targets, centred around net profit, efficiency, sales volume and growth. Some dealerships may employ a Fixed Operations Manager, however, their size and aftersales requirements may be more reflective of a Service Manager, who also happens to “oversee” the parts department. Higher bases have been seen in roles situated in NSW and Victoria.

General Sales Manager – Salaries tend to fall between $70,000 to $120,000 + superannuation and a vehicle. Depending on the size of the operation, an earning capacity of around $150,000 to $250,000 is common, though we have spoken to candidates who are on higher. Incentives often consist of multiple targets, centered around volume, growth, CSI / CE, overall profit and average unit profit. Some may also have incentives reflective of performance in finance, insurance and aftermarket. A common role in multi-franchise, high-volume sites, the GFC prompted the removal of a number of these roles in medium-sized dealerships. They are slowly making a comeback, but more so as a Sales Manager of the dealerships “primary” franchise, with oversight of the other brands and used vehicles.

Sales Manager (new or used) – Salaries tend to fall between $55,000 to $75,000 + superannuation and a vehicle. Depending on the size of the operation, an earning capacity of up to $150,000 is common, though we have spoken to candidates who receive up to around $250,000 where volume or luxury brands are concerned. Incentives often consist of targets centred around volume, growth, CSI / CE, overall profit and average unit profit. Some may also have incentives reflective of performance in finance, insurance and aftermarket. Base retainers in the $70,000 to $90,000 range have been seen in NSW and Victoria.

Finance and Insurance Manager / Business Manager – This is an area where we continue to see tremendous volitility, due to the attention of ASIC on flex commissions and add-on insurance items, plus the slow down in the market due to Covid-19. Salaries tend to fall between $45,000 to $55,000 + superannuation and either a car or car allowance, though some dealerships offer neither. Depending on the size of the operation, an earning capacity of up to $150,000 and better used to be the norm, though this seems to have come back to closer to the $120,000 to $130,000 mark. Candidates working within a luxury brand appear to still enjoy relatively high remuneration packages, compared to volume sites.

Parts Manager – Not a dramatic amount of movement in this space like there has been in others. Salaries tend to fall between $60,000 to $80,000 + superannuation and a vehicle. Depending on the size of the operation, an earning capacity of $80,000 to $130,000 is normally what we see. Incentives often consist of targets centred around volume, growth, shrinkage and overall profit. Group Parts Managers tend to receive an additional 20% to 30% on these figures.

Service Manager – No major swings have been noticed for these roles. Salaries still tend to fall between $60,000 to $80,000 + superannuation and a vehicle. Depending on the size of the operation, an earning capacity of $90,000 to $150,000 is normally what we see, with the lower range reflective of a smaller dealership. Incentives often consist of targets centred around labour sales, efficiency and profit. We have seen the odd Service Manager who is very well remunerated and is sitting in the $150,000 to $200,000 earning capacity, but this is rare.

Dealership Accountant – Salaries appear steady. Emphasis is still being placed on candidates with CPA or CA qualifications, though dealerships tend to not want to pay more for these qualifications, compared to other industries. Salaries tend to fall between $80,000 to $100,000 + superannuation and a car or car allowance, though some dealerships offer neither, or do so after a qualifying period. Depending on the size of the operation, an earning capacity of around $110,000 to maybe $120,000 can be expected. Incentives are not often paid, but when they are, they generally consist of targets focused on processing time and occasionally net profit improvement. The majority of candidates that we see in both Accountant and Financial Controller positions, are NOT CPA or CA qualified.

Parts Interpreter – Not a lot of change in the remuneration of these roles. Salaries tend to fall between $45,000 to $55,000 + superannuation and incentives. Depending on the size of the operation, an earning capacity of around $55,000 to maybe $70,000 can be expected, with incentives focused on sales performance.

Service Advisor – We are still seeing changes to the rewards offered in these roles, such as flexible working arrangements and reduced hours. Salaries tend to fall between $45,000 to $55,000 + superannuation and incentives. Depending on the size of the operation, an earning capacity of around $60,000 to maybe $90,000 can be expected, with incentives focused on CSI and sales performance. We have however spoken with Service Advisors in luxury brands that have a higher level of earnings.

Administration Clerks – Not a great deal of change in the pay scales for these roles in terms of averages, but we have seen the occasional Administrator who through longevity, has grown to be on quite a considerable package. Salaries tend to fall between $45,000 to $60,000 + superannuation and possibly some small incentives, though it is rare. Premiums tend to be paid for supervisory roles and also if a volume or prestige brand is in the mix, or very specific IT requirements are part of the role.

Mechanic – Continued high-demand exists to find suitably trained Technicians who are not looking for a mining hourly rate. Hourly rates tend to fall between $25 to $35 + superannuation but to source a suitable mixture of applicants you really need to be better than $30, or offer something that others do not, such as reduced hours, flexible hours, higher annual leave etc. Some incentives are offered based on productive hours and other metrics.

Some recent packages we have seen:

OTE means On Target Earnings, being salary and incentives together, excluding value of car and superannuation