Dealertrack Technologies chairman and chief executive officer Mark O’Neil emphasized that the more governmental regulations dealers face, the more valuable the company’s suite of solutions are.
Along with highlighting store appeal for its inventory management system and more, O’Neil explained the lengths Dealertrack is going to create a tool dealers can depend on as more rules from the Consumer Financial Protection Bureau and other regulatory agencies arrive.
“Dealers have reached out to us and asked us to make sure we’re prepared to help them,” O’Neil said during a conference call last week when Dealertrack reported its first-quarter financial performance. “It’s hard to be definitive right now because no one really knows for sure where things are going to land and how the lending landscape will ultimately unfold.
“We also have conversations going on with lenders because, look, they’re going to be the drivers of this,” O’Neil continued. “We’ve started to model a number of different scenarios for how loans would be presented to dealers and ultimately to consumers.”
O’Neil explained that Dealertrack’s personnel have started to create some early designs for high-level software requirements that would help to track regulatory elements such as disparate impact.
“These are very good conversations. We’re getting ahead of the curve. I think we understand the potential range of change,” O’Neil said.
“We’re just not ready to start quoting and developing a product because it’s still an unclear landscape of where it’s going to end up,” he continued. “Where it ends up, we’re going to make sure we’re giving a dealer the tools to help them manage their business in this new environment.”
O’Neil is confident Dealertrack’s past record of creating solutions dealers want foreshadows future success with any new compliance tool. To back up his assertion, O’Neil pointed toward Dealertrack’s solution for Red Flags and identity theft as well as the suite of new innovations the company showcased this past February at the National Automobile Dealers Association Convention and Expo. That cluster included upgrades to its inventory and digital retailing suites.
“It was very strong at NADA when we launched the new functionality,” O’Neil said. “We have a number of dealers that have it actively up and running.
“Dealers are acting as very strong advocates to other dealers,” he added.
Managers and principals recommending Dealertrack’s solutions to other stores are giving the company confidence to approach more segments of the dealership community.
“Of late, we’re more focused on the inbounds calls that are higher — from the five-store, the eight-store, the 10-store, the 12-store dealer groups. We have all of the functionality to address all of those dealer needs otherwise we wouldn’t be selling the current group of dealers we are,” O’Neil said.
Dealertrack encourages a single store within a group to conduct a pilot program of its software, a strategy the company boss believes in generating adoption by the entire retail operation after that trial period.
“That’s actually quite good,” O’Neil said. “We like dealers to try it before they buy it because it certainly gives them conviction once they move. We’re being very successful in the DMS arena based on our current offering and we have a very aggressive development roadmap that we’re not prepared to talk about publicly.
“We’ve shared that selectively with dealers and I think it’s opened a lot of eyes in terms of our commitment to the business and some of the unique things we can do that others can’t do.”
Dealertrack’s overall strategy is dubbed “Project Fusion.” It gained that moniker since the company is in the ongoing process of integrating all of its recent acquisitions into a streamlined product for dealers.
By the fourth quarter of this year, O’Neil said Dealertrack will have “tangible new solutions” to introduce to dealers. The company’s dealer council got a sneak peak of these products during a two-day span last week.
“The reaction was extremely positive,” O’Neil said. “In fact, I would summarize their reaction in their words as, 'We are probably two to three years ahead of any technology provider they’ve seen in terms of delivering truly integrated workflows with this technology.'
“A bit more effusive reaction than perhaps we anticipated, but obviously that’s a good thing. We’re excited,” O’Neil concluded.
Editor’s Note: For more Dealertrack commentary about deep subprime loan approvals, lender sentiment and the company’s Q1 performance, visit sister publication SubPrime Auto Finance News at www.subprimenews.com.