Automotive sages and soothsayers predicted a major fall off of car sales in 2018, mostly due to economic indicators, interest rate hikes, off-lease supply glut, so on and so forth.  What they failed to consider as they formulated their forlorn forecasts was what big momma may have in the offing.

Historically, there’s nothing like Mother Nature to surge sales as well as flood waters. Remember Hurricane Katrina, up until now, the costliest disaster in US history? She wiped out nearly a half a million vehicles and consequently, automotive sales peaked at all-time record volume in 2005 which is no surprise considering the need to replace the water-ravaged wrecks. As fodder for another story, 10,000 of those totals ended up in Bulgaria, being sold as low-priced dream cars turned nightmares when the corrosive nature of the saltwater eventually totaled those vehicles for a second time.

Now we have Hurricane Florence, predicted to be the new Queen of collateral damage whose windy wrath is soon to be felt in dense population centers in both North and South Carolina.  If it continues it’s arc up the coast, it has the potential to inflict destruction in Virginia, Maryland, Pennsylvania, and New York, possibly into Massachusetts as well.

2017 saw record auto sales for the simple reason that Hurricane Harvey wreaked havoc, largely in Texas to the tune of 125 billion dollars, tying Katrina as one of the two deadliest hurricanes ever.  It’s not ironic that 2005 and 2017 were two of the best years for car sales.

As one would expect, the best performing brands in Q3 of 2017 were representative of the three manufacturers historically favored by those geos hit hardest by the weather such as Texas, Florida, S. Carolina, Louisiana, and Georgia. Here’s the scoreboard; GM has experienced an 11.8% increase in sales, Ford at a 14.9% lift, and Toyota at an 8.9% spike.

GM and Ford pickups led the sales salvo with the Toyota cranking out record transactions as well. Nissan reported that its popular Rogue also set a record, selling just 4,000 units less than the Rav4.

What lies in store for car dealers up and down the coast remains veiled in a “wait and see” phase.  If they can keep their inventory above water, and avoid surging flood water, they may be in for a monetary windfall.

Kelly Kleinman

Content Manager/Dealership News

www.Dealershipnews.com

818-817-6343

This article was inspired by Amanda Gordon who responded to a very recent article on this site by suggesting that no matter what, it always comes down to human interaction at some point during a sales transaction, regardless of the circuitous route taken to consummate that sale.  Thank you for the inspiration Amanda.

Now, I wrote a piece a while back suggesting that we can have all of the automated systems we want in order to facilitate salesmen-free car deals, but at some point we need to interact with a real person. We are a social species by nature! We do best face to face and always will,  although technologists are trying to change our core behavioral proclivity with their addictive technological heroin called a "mobile device."

Do you want to make more sales, have more return customers, have more referral business, and improve the performance of your service department?  Here are a 8 novel concepts first published 81 years ago by the one and only Dale Carnegie that are guaranteed to "boost sales." Excuse his dependence on male references, he lived in a day when a man was a man, and ...forget it (LOL).

1. Do not criticize. “Criticism is futile because it puts a man on the defensive, and usually makes him strive to justify himself. Criticism is dangerous, because it wounds a man’s precious pride, hurts his sense of importance, and arouses his resentment.” (Do not even criticize a competitor in the company of a prospective customer!)
2. Give honest, sincere appreciation. “Dr. Dewey says the deepest urge in human nature is ‘the desire to be important."  Find something in everyone to sincerely appreciate, we all have value!
3. Get the other person’s point of view and see things from his (or her ) angle. The thing here is to give to your interlocutor what he (or she) wants, and not what you, you want or want to sell.
4. Become genuinely interested in other people. “Encourage others to talk about themselves."  Folks are generally more interested in themselves than anyone else these days...you don't have to be.
5. Smile. A smile is human sunshine (I made that up just now).
6. Remember names. “Remember that a man’s name (or a woman's) is to him the sweetest and most important sound in the English language. 
7. Be a good listener. God gave us two ears and one mouth, listen attentively and learn about what the customer needs to best serve them.
8. Make the other person feel important. “And do it sincerely”

Seems like some of these concepts overlap a tad, but for the most part, when the best practices of Dale Carnegie's book are followed, really good things happen.  Human behavior hasn't changed since the beginning of our time on earth, and all of the technology in the world cannot change our need to inter-relate with one and other. We are a social species. The bottom line here is pretty obvious; get good at interacting with real people by better understanding their basic nature and needs, and service them accordingly. Technology may be touch screen, but the human touch wins out in the end.

WELCOME TO THE NATIONAL DEALERSHIP STANDINGS SUMMARY REPORT JUNE 2018

If you believe automotive industry articles analyzing June sales numbers, sales of new cars haven't fallen off the cliff as expected. If you look at new car sales numbers in May or June of 2017 compared to May or June of '18 (calendar month sales), some dealers in the big markets are doing OK, but most are seeing a distinct fall off of new car sales. Are we at the precipice of that major downturn in new car sales? Are we already in it?  You be the judge.

LOS ANGELES MARKET: (Sans Luxury car sales and F-150 trucks), new car sales in the LA area are down 14% on a survey of 321 dealers.  3 new dealerships have no previous June to compare against so if we remove the new downtown stores of Kia, Toyota, and Nissan, only Subaru Pacific has had a better June of '18 than June of '17 out of the top 25 car dealers by calendar month sales.  Galpin Mazda, and Puente Hills Subaru were the only other two dealerships who sold over 200 cars with better showings this June than last June.  

WASHINGTON DC MARKET: Four of the Top Ten dealers are showing increases in sales over June of 2017 but the sales fall offs of some of DC's biggest dealers tip the scales to the dark side. Based on 260 DC area dealerships, new car sales are down a whopping 18.04%.  Dealerships doing well in the DC Top Ten, include Carmax Laurel Toyota up 4.37%, Honda of Chantilly up 3.06%, and Autonation Honda Dulles which is up 14.45%.  Dealerships that showed drop offs include Koons Tysons Toyota 16.22%, Darcars 49.34%, and 355 Toyota 18.94%.   

DALLAS MARKET: Unlike the rest of the country, Texas is it's own nation. Although they are down on a survey of 185 dealers 4.5% overall, the Top Ten Dealers are actually doing pretty well in comparison to the rest of us.  Of their Top Ten, five dealers are showing sales growth. David McDavid Honda was up 7.25%, Vandergriff Chevrolet spiked up 142.64%, Clay Cooley Nissan jumped 4.14%, Huggins Honda up 7%, and Toyota of Richardson did a 7% vert.

CHICAGO MARKET:  Based on a survey of 278 dealerships, the windy city was off 16.84% from June of 2017.  Of the areas Top Ten Dealers by calendar month sales, four dealers showed improvement over last June. The Honda Superstore of Lisle was up 16.8%, Castle Honda had a 9.3% lift, Zeigler CDJR calf-raised 2.92% and Sherman CDJR pole vaulted 30.83% over June of 2017. Car sales performances throughout the Midwest look very dodgy when compared to the same month last year.  Overall, Chicago's Top Ten Dealers experienced a 5.56% drop off in new car sales June 2017 over June 2018. 

As loans get more expensive and difficult to get, and folks with less than superb credit scores get rerouted onto the used car lot, we can expect new car sales to suffer accordingly.  I continue to read articles about how new car sales aren't lagging as bad as experts thought they would be.  Still, as I review monthly comparison data dealer by dealer, I see a trend that may suggest the new car stall is happening now, we're just looking at the wrong data sets.

While at the IADAC Conference in Lake Tahoe, we took a few minutes to chit chat with the used car Queen of Orland, Ca. Brittany Hibdon of the Hibdon Auto Center

Dealership News: As a woman owner/operator, do you find it gives you an advantage or a disadvantage in dealing with customers? Is it easier dealing with male buyers or do you find the women are more trustworthy of you than they would be a man?

Brittany: I believe talent and personality play more of a role than gender. However, there is a lot of stigma attached to the idea of a “typical salesman.” The majority of my sales staff is female, and we’ve had people walk in the showroom and comment in surprise at the number of women employed. Breaking the stereotype expected might be an advantage all on its own! Women also tend to have more empathy – nurturing is in our make-up. With male or female customers, we tend to wear our hearts on our sleeves, and customers see that we care. I think this may allow us to break down walls and connect faster with our customers. I’ve actually found that customers are less concerned with my gender than fellow industry members! When I first started buying cars at the auction, it was clear I had entered a man’s world. I think since it’s still fairly uncommon to meet a female dealer, most dealers are simply surprised by it. I’m very grateful for the friends I’ve made and the respect I’ve been given as I’ve made my mark in this industry.

Dealership News: Tell us a little bit about the dynamic of working with your husband who runs the service dept. Who gets in who’s hair the most?

Brittany: That’s debatable (LOL). In all seriousness, we get along quite well. My husband does a fantastic job of overseeing our Service Department, and knows more about fixing cars than anyone I’ve ever met. Even other shops in town call him for advice. I stick to my role of General Manager and we stay out of each other’s hair for the most part. In addition to regular managers meetings with our leadership team, he and I recently started a “Same Page Meeting” once a week, and that helps us by purposely setting aside time to discuss any issues that we both need to work on together.

Dealership News: Every small-town dealer has its main competitor, without naming names (we know who it is LOL), what do you do better than they do, is it service, is it sales, is it selection?

Brittany: I have a lot of respect for our largest competitor. However, I believe that our niche separates us from all of our competition. Our mission statement says it best:

Brittany: We put our customers first, before everything else. We believe everyone deserves to drive a Nicer, Newer car®. Our business is different- our business is not selling cars. Our business is finding solutions to the everyday problems that keep most people stuck in a car they hate. We’re on a mission to change the world one person at a time by helping them get the car they want and deserve.

Dealership News: Who are your favorite vendors and do you use classified listing sites so you can pull from surrounding cities or do you use other methods such as social media, radio, or cable TV to bring folks in?

Brittany: We’ve done well with radio and social media. We work with an incredibly talented marketing company that has helped us increase our reach to surrounding cities and grow our customer base. We’ve found that speaking to masses works better for us than targeting specific buyers or spending money on classified listing sites. It’s not for everyone, but it works well for us!

Dealership News: You can’t satisfy all of the people all the time but you sure can try, what measures do you have in place to make sure you aren’t held hostage by negative reviews or questionable review sites like the good folks at Yelp?

Brittany: I appreciate your classification of Yelp as “questionable!” I think best way to handle a negative review is to respond. If the customer is upset or frustrated about something, I try to leave a short reply and then take the conversation off-line. We reach out and often can get to the bottom of the situation and find resolution. Some people just like to complain and won’t respond to us, but that’s OK too. I’ve had situations where customer see our replies to negative reviews and “like” or comment in agreement with us! People want to see that we are real, and that we care about the things they care about.

Dealership News: Where do you see the future of the automobile industry after the electric and autonomous cars kick in, say 10 years down the road? Will the used car business survive?

Brittany: Since I am in the solutions business, not the car business, I think there will always be customers to help and problems to solve. I also believe customers want great service, they want human interaction, they want to touch and drive and smell and see. Electric or autonomous cars are probably not for everyone, and as the industry shifts beyond just new technology to buying online, etc. I believe giving the customer an unexpectedly wonderful experience will stand out even more.

Kelly Kleinman

Dealership News

Kelly@Dealershipnews.com

818-817-6343