The auto industry has always reflected the economy that supports it and most auto industry insiders agree that the recent consolidation of new car dealerships was necessary to maintain the equilibrium between supply and demand.  Unfortunately, the sensitive balancing act between new car supply and consumer demand was thrown off by the “success” of the Cash For Clunkers Program which artificially depleted new vehicle inventories.  Auto dealers had already cut back on new car orders to accommodate reduced sales volumes, and floor plan limits capped by shrinking working capital reserves limited the amount of new and used cars that auto dealers could keep in stock.  As a result, car dealers have not been able to timely replenish their sold inventory to maintain sales momentum and preserve profitability.  More urgently, dealers are scrambling for a way to stay ahead of fixed expenses that have already been cut to the bone.

Many automotive advertising agencies predicted that the Cash For Clunkers Program would produce an artificial wave of business with the associated “peak” in new vehicle sales during August followed by the “valley” in September that could continue through the balance of 2009.  Recent SAAR statistics project an adjusted annual sales rate of 8.8 million new vehicles in September proving that their worst fears have been realized.  Successful auto dealers focus on solutions rather than problems.  As a result, used cars have taken on a new importance with a number of creative techniques being applied to acquire used cars with a priority of selling used cars vs. new cars that are in short supply. Read the rest of this entry »

A shrinking economy has been the catalyst for reducing the amount of “brick and mortar” auto dealerships compounded by the consolidation brought about by the reorganization of General Motors and Chrysler.  The growth of the Internet Superhighway could not have been timed better, as 92% of the people buying a car are driving onto the Internet Superhighway in favor of the reduced number of car dealers on their local car row.

The car buying public will always take the path of least resistance and the Internet was already growing as the information resource of choice when selling a car or buying a car.  People selling new cars and/or used cars will naturally gravitate to where people looking to buy used cars and/or new cars are shopping, however the abrupt closing of thousands of auto dealerships across America has increased traffic to dealer websites at a faster rate than anticipated.  The result is an explosive need to improve the technology and the associated applications to enhance selling processes to facilitate buying cars and selling cars in a more efficient and cost effective manner. Read the rest of this entry »

With the C.A.R.S. program in full-swing, or some would say “roller-coaster mode”, I thought I would touch on some opportunities for dealers who want to think outside of the box.

Cash for Clunkers is bringing big business to dealers nationwide who are selling new cars to people who might otherwise be buying used cars.  Some dealerships are having new car deals fall right into their laps without even trying to promote the program while others are using it as an “event” to help drive additional traffic for people considering a new car.  Even when the program was briefly suspended before more government funds were thrown into the rebate coffers, dealerships were receiving calls on whether or not the car buying public could still take advantage.  I think this program will be a much needed shot in the arm for automotive new car sales, but that dealers should invest more of their time promoting it opposed to letting nature take its course.
Read the rest of this entry »

Don’t tell anyone, but the economy is in the tank.  Home sales are down and property values are falling.  Auto sales are also down and auto dealers are faced with excess inventory and reduced profits.  Wait a minute - let’s think about that last line!

I may be wrong, but if sales are down and dealers have more new cars and used cars than they can afford to stock wouldn’t that be a good time to buy one?  The answer is - YES!  Of course buying a car can still be a challenge but if you were selling a car right now wouldn’t you be more receptive to an offer - any offer?  Sure you would and car dealers are people too! Read the rest of this entry »

Having worked in the trenches of auto dealers, I would like to share with you what I told every pre-owned shopper that I’ve ever spoken to.  “If I were going to purchase a pre-owned vehicle, I would make sure it is certified.”

This was not some salesperson’s ploy to charge customers more.  Truth is, the cost of a certified vehicle opposed to a non-certified is not a significant difference, but there is the potential to be a major difference mechanically.
Read the rest of this entry »

In one of my former lives I wrote a book titled “How To Buy A Car - The Inside Story, Ex Dealer Tells All” which was quickly followed by its sister book, “How To Sell A Car - A Career Guide To The Car Business.”  Frankly, I wrote the sequel so my friends in the car business wouldn’t feel left out, but it surfaced the insights that I will share with you about how to buy a car or sell a car online.  My publisher’s first thought was to print the books together, you know, like they do with operating manuals in English and Spanish where you hold it right side up for English and upside down for Spanish but we agreed that we would make more money if we sold them separately.  After all, business is business and two sales are better than one!

Both books recognized that to sell a car a professional car salesperson needed to understand and respect the customer’s needs and inversely the customer would often get a better deal and a more enjoyable shopping experience if they developed a good relationship with their salesperson.  Tip one on how to buy a car or sell a car online is drawn from the fact that people like to do business with people that they like.  The first investment that should be made is in the relationship between the buyer and the seller.  That logic applies to both sides of the negotiation table and it starts with the first impression that both parties give and get. Read the rest of this entry »

The summer is upon us.  That means it is time for legions of parents to grab the kids and embark on the annual summer getaway.  With the downturn in the economy, more and more people are choosing to take the age-old road trip opposed to flying.  So is it that easy to just pack up the family roadster with luggage, hop in, and set off?  Not so much.

Family motoring is an art form.  If you are taking a long journey with the kids, here are some useful tips to keeping the kids entertained.

Read the rest of this entry »