Shoppers are turning more and more to the Web and their mobile devices for car shopping. In fact, according to Autotrader’s Car Buyer of the Future Study, 42 percent of new and used shoppers are now using multiple devices, a combination of items such as their desktops, laptops, tablets and cell phones to shop for vehicles.
Larry H. Miller Dealerships is tackling this trend head on, with the company announcing today it has a new product that allows shoppers to nearly complete the entire car buying process online.
The new integrated online to in-store solution for the dealership group — LHM Fast Pass — enables customers to select and reserve a vehicle online.
“LHM Fast Pass provides a seamless experience for customers to search, select and reserve a vehicle online; it allows customers the ability to manage their own deal from the start,” said Dean Fitzpatrick, president of Larry H. Miller Dealerships. “As more consumers conduct their research online prior to entering the store, we feel it is the next evolution in the car buying experience.
“Customers value their time and are looking for efficiency, and LHM Fast Pass empowers the customer to structure a deal to meet their needs.”
LHM Fast Pass is launching in select stores in Salt Lake City; Colorado Springs, Colo.; Albuquerque, N.M. and Spokane, Wash.
The program will launch in all 54 dealerships throughout the western region by late summer, the company reported.
Shoppers on the dealership website can search through the inventory, select a new or used vehicle and click on the LHM Fast Pass icon.
Then, customers can offer their information, apply for approval and make a deposit via PayPal in order to reserve the vehicle for 24 hours.
The company said shoppers can also get an online valuation for their trade.
A salesperson will then call the customer to schedule an appointment to complete the final paperwork, and the car can be washed, waiting and ready for the customer when he or she arrives at the dealership.
The company also pointed out that when a customer using the tool is making a trade, a trade appraisal specialist will be available to ensure the customer gets the maximum value.
And used-car customers will also have the option of signing up for a price alert on a used car, so they will be notified every time the price on that vehicle drops as long as the car is still on the lot.
“We are continually looking for ways to improve the quality of life for our customers,” said LHM Dealerships senior vice president of marketing Paul Nygaard. “LHM Fast Pass will allow our customers to spend more time with their family and friends and less time shopping for a car.”
A recent study conducted by DealerSocket suggests that viewing your fixed operations as a percentage of your dealership’s total revenue may be the wrong approach.
In fact, the study shows that even though the average dealership’s fixed ops only accounts for 12 percent of the store’s total revenue, when you look at a dealership’s net profits, their fixed ops account for 60 percent of total profits.
Another telling statistic from the report — which surveyed data for the top 10 percent of the top-performing dealers amongst the more than 6,500 stores that DealerSocket serves — showed that 88 percent of customers will schedule an appointment simply if they’re asked.
This shows the potency of calling customers to see if they would like to schedule something like their next oil change or tire rotation. On that note of service, the study showed that a customer was 29 percent more likely to schedule their first appointment with the dealership if they were introduced to the service employees near the time of purchase.
Here are a few other key statistics provided by DealerSocket on its recent study:
- 78 percent of customers are influenced by a negative review, showing the utmost importance of taking care of the customers while in the store to earn positive reviews.
- 12 percent of callers decline an appointment when asked to visit the store, reflecting the importance of extending that option to potential customers calling in with various inquiries.
For more information about DealerSocket and its offerings, visit their site here.
MD Johnson, which provides guidance on purchase, sale, analysis, succession, valuation and restructuring of dealerships, recently helped to orchestrate the successful sale of BMW of Tri Cities from Tim Bush to Ralph Martinez.
Officials indicated the dealership will remain named BMW of Tri Cities at its current state of the art facility off of Interstate 82 and Aaron Road on property that Martinez acquired from Bush in a separate transaction. The closing of the transactions occurred after required and customary approvals by the parent automaker.
No sales price was disclosed, according to MD Johnson.
Bush purchased the dealership from long-time Yakima, Wash., dealer Dick Hahn of Hahn Motor Co. Bush then relocated the store to suburban Richland, Wash. Prior to Bush's relocation, officials noted the Tri Cities had not had a BMW dealer for more than 20 years.
Along with the BMW store, Bush had previously owned the Suzuki franchise in the Tri Cities along with his separate pre-owned vehicle business.
“Tim has enjoyed his time in the automobile business and will continue to expand his growing full service automated car wash business in the greater Pasco, Richland and Kennewick areas.” Johnson said about Bush, who is joined in his business by sons TJ and Blake.
Martinez's Town & Country Group also owns Town & Country Honda in Gladstone Ore., a suburb of Portland.
“We are very happy to be a part of the BMW family,” Martinez said.
“BMW is considered at the top of the luxury brands and we are excited to represent them in the Tri Cities,” Martinez went on to say while adding his son, Christopher, has been named general manager of the newly acquired dealership.
The average franchised dealer generated more than $15 million in sales from the used-car department last year, and more than two-fifths of the used cars those dealers combined to sell arrived at the stores through new-car trade-ins.
That’s according to NADA Data 2014, which is the National Automobile Dealers Association’s annual look at the financial profile of franchised dealers.
The report indicates that 26 percent of used cars sold by franchised dealers were sourced at the auction, which was second only to new-car trade-ins (42 percent).
Meanwhile, nearly a quarter (24 percent) came to the lot via trade-in on a used-car sale.
Four percent were sourced through a street purchase and another 4 percent were found through other avenues.
All told, the average franchised dealer had $15.23 million in used-vehicle department sales last year, which was a 6.0-percent increase from 2013. It also represented 31 percent of total sales, according to NADA.
Based on charts from NADA, net profit for the used department of the average dealer (including F&I) appeared to be down modestly from 2013 but was still above $100,000.
The average retail selling price on used cars sold by franchised dealers continued to climb, following a trend that began in 2010. In the past five years, the pricing has gone from around $15,000 to the neighborhood of $19,000, according to a NADA chart.
Auctions and dealerships that have a strong business interest in how classic cars are moving on the wholesale and retail fronts should be pleased to hear the upbeat projections from IBISWorld, which said the industry appears “to be back on the right track.”
The firm’s latest report showed that revenue is estimated to increase during the next five years, including a “robust” jump this year.
“Classic cars are highly discretionary purchases; therefore, demand for the industry is extremely elastic among most U.S. consumers and depends on prevailing levels of per capita disposable income,” IBISWorld economic analyst Nick Petrillo said.
When per capita disposable income levels fell and investor uncertainty increased during the recession, Petrillo explained that fewer consumers purchased classic and antique cars.
“Although per capita disposable income has gradually returned from its historic lows, many middle-class consumers have yet to resume purchases of industry vehicles due to depleted savings and relative disinterest in spending money on such high-priced assets,” Petrillo said.
With the economic recovery likely to yield greater purchases on classic cars from both wealthy investors and the general public, IBISWorld anticipates industry revenue to steadily grow over the five years to 2020.
Analysts projected demand for classic cars of all makes and models is anticipated to grow, although budget classics and American muscle cars are most poised for growth.
The IBISWorld report also highlighted dealers will benefit from higher demand for classic cars, which will likely push up auction prices on many of the industry’s most popular models.
“Higher auction prices will ultimately boost industry profit margins over the next five years as a result,” Petrillo said.
Nevertheless, Petrillo acknowledged long-term industry growth prospects will be limited by external competition from many individuals throughout the United States who own and sell classic cars amongst themselves.
“Independent sales of automobiles are extremely common and represent an increasing threat to the industry, particularly as consumers gradually increase their use of online classifieds to advertise their automobiles to a national audience,” Petrillo said.
“New-car dealers will also represent a major source of competition for industry dealers as major manufacturers have begun a trend of modernizing classic models and retailing them as modern, state-of-the-art collectibles,” he went on to say.
TrueCar announced Monday it has hit a record for dealer enrollment during the first quarter.
The site enrolled 840 dealerships in Q1, which marked the biggest-ever volume gain in the company’s history.
The new additions brought the TrueCar Certified Dealer network to an all-time high of 10,680 franchised and independent dealer partners, which is up 38 percent year-over-year.
"This all-time record expansion is getting us closer to optimal dealer coverage across the U.S.," said Scott Painter, TrueCar's chief executive officer and founder. "Growing the TrueCar Certified Dealer network allows us to satisfy more consumers, more frequently in more places than ever."
Franchised dealer enrollment spiked the most last quarter, with 607 new additions to the site. The number of active independent dealers jumped up by 233.
As of the end of March, there were 9,108 active franchised dealers on the site, while independent dealers were up to 1,572.
"We appreciate our dealer partners' support and are pleased with the record level of dealer interest in TrueCar," Painter said. "Notwithstanding our growth in recent years, we're still in the early stages of building a national, consumer-facing brand. As a result, we look forward to helping our thousands of dealer partners nationwide be even more successful by sending increasing numbers of in-market car buyers to their dealerships.”
Improved sales numbers are usually aided by a good reputation. And that reputation, according to a recent release from J.D. Power and DealerRater, starts in your service department.
The March 2015 PowerRater Consumer Pulse, a monthly analysis of — as the title suggests — consumer opinions, is developed jointly by J.D. Power and DealerRater, each of which lend their specific angles on the automotive industry to create a picture of how customers feel about their dealer experiences.
According to the report, “a dealer’s ability to satisfy its service customers boosts its reputation for good service, which may ultimately lead to increased vehicle sales.”
Other key findings, according to the report, are as follows:
- Highly satisfied service customers (overall satisfaction scores of 901-1,000 on a 1,000-point scale) are more likely to write a review about their experience, compared with those who are merely satisfied or indifferent (scores of 750-900), according to J.D. Power. Among the 37 percent of highly satisfied customers, 4.3 percent indicate that they posted an online review of their experience. In contrast, less than 3 percent of service customers who are either merely satisfied or indifferent posted an online review.
- Among highly satisfied customers who posted an online review of their last service experience, 91 percent of the reviews were positive; among merely satisfied or indifferent customers who posted a review, only 71 percent of the comments were positive.
- According to data collected by DealerRater, 40 percent of car buyers indicate that the service department’s reputation was significantly important in choosing the dealer they purchased from.
Chris Sutton, the vice president of U.S. automotive retail practice at J.D. Power, reflected on the findings.
“Clearly, there is a strong incentive for dealers to maximize customer satisfaction as it leads to a greater likelihood that customers will post a positive review, helping to support the reputation of the dealer’s service department,” Sutton said.
Furthermore, J.D. Power recommends five critical areas to focus on that have the “highest potential impact on customer satisfaction” in the service department.
- A service advisor who focuses on customer needs.
- Providing helpful advice to customers.
- Fixing a vehicle correctly the first time.
- Quick access (within 2 minutes) to a service adviser.
- Having the vehicle ready when you said it would be ready.
AutoMatch USA, a dealership chain that specializes in foreign and domestic pre-owned vehicle of all makes and models, opened its fourth location on Monday.
The newest store joining the network that already includes a lot in Illinois and two others in Florida is located at 13111 South Minuteman Drive in Draper, Utah. The store is situated off of exit 291 from Interstate 15 in the Salt Lake City market.
This dealership joins AutoMatch USA locations in Morton Grove, Ill., as well as in the Sunshine State cities of Jacksonville and Fort Myers.
“We are pleased to announce the opening of our fourth AutoMatch USA location. We have experienced great success across our dealerships in Florida and Illinois, and we are very excited to expand our services to the greater Salt Lake City area,” Marcus Lemonis owner said.
“As a company, we will continue to offer the best value for people searching for reliable and affordable transportation, as well as the financing, insurance and warranty to go with it,” Lemonis continued.
The grand opening celebration for this Utah store begins on Friday and runs through April 4, featuring price specials as well as a ribbon cutting with the local chamber of commerce on Saturday.
Last summer, AutoMatch USA outlined plans for several other openings, including another store in Florida as well as in Arizona and California.
The company retails used vehicles from brands including Chevrolet, Ford, Dodge, Mazda, Jeep, Cadillac, Chrysler, Mercedes Benz, Audi, Porsche, BMW, Lexus, Toyota, Honda and more.
AutoNation announced this week the reopening of several luxury dealerships. This included two Porsche dealerships — Porsche Plano and Porsche Bellevue — as well as Audi Plano and Lexus of Cerritos.
The first to reopen this past week on Tuesday, Audi Plano, features a redesigned facility with over 60,000 square feet of space. It also garners an additional 12 service bays with lifts, a new alignment rack and tire mount and balance machines, bringing the total bays to 27. A mile away, an off-site service center was added, which offers a full “Perfect Delivery Inspection” and a used vehicle reconditioning center with six service bays. The facilities staff 107 associates and will be open Monday to Friday 9 a.m. to 8 p.m. and Saturdays 9 a.m. to 6 p.m.
Lexus of Cerritos reopened on Thursday, boasting 74,000 square feet of redesigned floor space. It also features 59 service bays, 160 associates and an increased showroom and service department. The facility plans to be open Monday through Saturday from 9 a.m. to 9 p.m. and Sundays from 9 a.m. to 8 p.m.
Similar to Porsche Bellevue, which Auto Remarketing reported on earlier this week, AutoNation also reopened Porsche Plano. The 40,000 square foot facility added 3,000 additional square feet of space. It also added 4 service bays, bringing the facility’s total to 23. The Porsche store currently has 53 associates and will be open Monday to Frida from 8 a.m. to 7 p.m. as well as Saturday from 9 a.m. to 6 p.m.
AutoNation announced today the reopening of Porsche Bellevue in Bellevue, Wash. The Porsche location was part of the company’s acquisition of Barrier Motors Premium Luxury Group at the end of last year.
The ribbon cutting ceremony will be tonight at 6 p.m. at the facility’s location of 11910 NE 8th Street.
The location, which features a 38,000 square foot store, will have on display several of the German automaker's high-end feats of engineering, including the new Cayman, 911, 918 and Cayenne.
The service department at Porsche Bellevue features 16 service bays, 1 alignment bay and 43 associates on staff to provide the utmost care for customers. The facility will run Monday through Saturday from 9 a.m. to 8 p.m. PST and Sunday from 10 a.m. to 8 p.m. PST.
