By on January 2, 2009

Sales is one of the few professions where employees must maintain a positive attitude– no matter what. John Candy’s curtain ring sales in the movie “Planes, Trains and Automobiles” exemplifies this “never say die even when you’re dying” job requirement. Arthur Miller’s “Death of a Salesman” is the excruciatingly pathetic flip-side. MLive gives us sample of latter day unfettered optimism. “‘Traffic started picking up with the announcement that GM had the loan money,’ said Bob Johnson, new car sales manager at McDonald Pontiac, Cadillac, GMC Truck, 5155 State in Saginaw Township. ‘Then they came back with the GMAC rates. People are starting to loosen their belts.'” ML pauses for a quick reality check: “The Detroit automakers are trying to weather the biggest automobile sales slump in more than 26 years. Forecasts for December range near 10 million and actual sales could prove the lowest since August 1982.” And then we’re off for another spin around fantasyland. “Savvy buyers know the kind of deals available, said Rob Roy, news car sales manager at Draper Chevrolet, Dodge, Toyota, 4200 Bay in Saginaw Township. ‘They’re aware of the incentives,’ he said. ‘But it doesn’t matter what brought them in. Business has been good since (Dec.) 26th.'” For which part of the biz, Bob? Chevrolet, Dodge, Toyota or all three? Not specified. More of the same after the jump, plus doom and gloom and things go boom– in Bloomberg’s blog!

“You can feel a significant shift in the last couple of weeks,” [Tad Veremis, new car manager at Martin Chevrolet, 8800 Gratiot in Thomas Township] said.

For the past two days, customer traffic at Suski Chevrolet Buick, 8700 Main in Birch Run, was unusually brisk, said Brad Goldman, new car sales manager. Still, sales this month do not compare to December 2007, one of the dealership’s best sales months.

“We’re not breaking any records, but we’re staying strong,” he said.

Restoring consumer confidence is key, said Craig Lang, new sales manager for Garber Chevrolet in Midland.

December sales are down about 50 percent from December 2007, but are up from November at the dealership, he said.”

Meanwhile, back on planet earth, Bloomberg reports “Auto sales tumbled more than 25 percent each month since September as the credit crunch reduced access to loans and consumer confidence fell amid a weakening economy. With demand for large pickup trucks and sport-utility vehicles damped earlier this year by record fuel prices, analysts expect an annual total of slightly more than 13 million autos, the fewest in 16 years.

“Consumers are scared,” said Erich Merkle, an auto analyst in Grand Rapids, Michigan, for consulting firm Crowe Horwath LLP. “People that are going to be laid off won’t be buying cars, and even those that are working are likely delaying purchases.”

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28 Comments on “Auto Sales Are Up! Only They’re Not. Really....”


  • avatar
    mikey

    Without a doubt,the deals in Canada are the best I’ve ever seen.I don’t care what your buying the dealers are bending over backwards.

    7 Impalas where I deal,none that caught my eye.
    I showed the salesman my wish list.Come back in 2 days we will have your car.Top dollar for my trade
    and I’m 2500$ under my budget.

    9:30 AM on New Years eve every salesperson had a client.

  • avatar

    I stopped in at a Cadillac dealer near Detroit this week, and was told that business has picked up quite a bit in the last week or so. And TrueDelta received more traffic than ever before in the days before New Year’s. So maybe sales are coming back?

  • avatar
    TexN

    I think getting through the holidays will be a help to the overall market. As the warmer weather hits in the spring, there will also be more action in the car sales market. I still firmly believe that resentment over the bailout will erode Chrysler and GM market share. When they come back for more in the spring (which they will) there will be further resentment from the buying public. GM & Chrysler still haven’t shown the ability or resolve to make the tough decisions to change their cost structure. The little credibility that they still have will melt away at about the same time as the snow does in the midwest……..

  • avatar

    “Savvy buyers know the kind of deals available”

    Savvy buyers always do well. The current system in place preys on the weak. Think about it. You can safely send any recent immigrant, any young person (of age), any recently widowed senior, any slightly mentally handicapped person, or any person in a hurry to any major (non auto dealer) store with a newspaper ad and reasonably expect them to return with specified advertised itemat the advertised price. That would never happen in a million years at a car dealership.

    I have a good secure government job and I know two co-workers who recently went car shopping at Chevy and Chrysler and both came away empty handed. Now I happen to know the game (which I hate) but why is it that the dealerships still act like nothing has changed.

    My first friend was interested in a Chevy Malibu and inquired at Castriota Chevrolet. He was the only customer on the lot that day. He asked about a specific model on their lot and asked how much the dealer wanted. The salesman replied how much are you willing to pay? My friend somewhat dumbfounded asked again no really I am interested in this car how much do you (the dealer) want for the car. The salesman replied you have to tell us how much you are willing to pay. The sales manager approached and asked if there was a problem my friend. The same exchange took place. My friend exasperated said look you own this car, You know what you want for it I don’t. If you came to me and asked to buy my car I know what I want for it but you don’t.

    My friend left and went across the street to the Hyundai dealer. He asked them how much they wanted a Hyundai Sonata. The salesperson came back and gave my friend a specific price. A good one in my friends opinion. He bought a new V6 leather loaded Hyundai Sonata. My friend has had his government job for over 20 years. He has outstanding credit. He owns a house on a lake on an acre of land that he bought 20 years ago for 80,000 dollars and has very little debt and yet this Chevy dealership acts like they still hold all the cards. If things are so bad then change your tactics. My other co-worker, a younger person went to several Chrysler Dodge dealerships looking to buy a truck and came away empty handed. I don’t know the specifics but he said they were trying to screw him.

    Why can’t I buy a car like any other mass produced item? That’s the problem.

  • avatar
    Gottleib

    I agree with Sherman. Although I could go buy a new car I avoid it because I hate the experience of having to deal with the sales system at the auto dealerships. The last time I was in the market, a year ago, and asked that the $495 document fee that was pre-printed on the sales form be eliminated and was told that was impossible, was the last time I was in a dealership.
    And I am not all that smart, of average intelligence with limited mathematical abilities, but I still don’t like being treated as though I know nothing. When I can go to a dealership and receive respectful and honest treatment, I will consider buying a new car. Until then I will continue to go to my mechanic who is honest and respectful.

  • avatar
    Bridge2far

    Sherman Lin

    It is unfortunate that your friend was mistreated by the Chevy dealer. Not all dealerships operate in that manner. And with the current financial situation, I would venture to say that that dealer will either change their sales tactics to a more customer friendly approach or they will simply go away. In a perfect world, you would have an honest open exchange between client and consumer and everything would be beautiful. However, there are a few ingredients that spoil the broth. Trade-in value. Salesperson dishonesty. Customer dishonesty. Clashing personalities. Etc. My advice is to research a dealership’s background and standing with the BBB before landing on their lot. Or you may approach them via the internet as most dealerships have this very importand dept. By the tone of their email response, you should have a good indication of whether or not you might attempt to have that particular dealer attempt to earn your business.

  • avatar
    factotum

    Sherman: If your younger friend knows what he wants why not direct him to the link on the right hand column “New Car Consultant”? You’d do TTAC and your friend a favor, I imagine.

  • avatar
    Bridge2far

    Another indicator of a dealer’s integrity (or lack thereof) is usually found in their newspaper ad. If they advertise a $40,000 vehicle lease at $199 per month, beware! There is one law of auto ads that should be heeded at all times- “What the big print giveth, the small print taketh away.”

  • avatar
    Rod Panhard

    Sherman, at the Chevy store, they were begging you for a low-ball offer. You should have tendered one that hit ’em in the kneecaps.

    The car salesman’s game is a ridiculous institutionalized game. No one likes it, not the salesmen, managers or even the dealers. But it’s the only way they know how to play, and it seems successful to them because their doors are still open, so “obviously,” the system works for them. This institution won’t go away, as proven by your trip to a dealer’s lot even in the worst of times.

  • avatar
    ireallylovemangoes

    Rod Panhard said

    “Sherman, at the Chevy store, they were begging you for a low-ball offer. You should have tendered one that hit ‘em in the kneecaps.”

    Rod, for my benefit, what would have been the “right” answer here? I know walking away is one, but if someone wanted to actually make an offer?

    I am going used car (looking for gently used 2008) shopping on Monday and wouldn’t mind any advice. Anyone else who wants to provide advice is certainly welcome.

    Choices right now are between: Mazda CX-9, Buick Enclave, Ford Taurus X or Ford Explorer. Each has their own pros and cons. For the CX-9, to get it in the same price range as the others I will have to buy one in the States and import it back to Canada.

    Have cash in hand and am not married to anyone vehicle at this time although I do really like the Mazda.

  • avatar
    jimmy2x

    There ARE alternatives. I bought my 4Runner in may from Fitzmall in Gaithersburg, MD. Prices are posted on the internet with accurate descriptions of the vehicle and accessories installed. Even with the cost of a one-way rental from the Philly burbs, I saved $1700 over the best price available from a half dozen “local dealerships” – and minimum BS doing the actual paperwork. Actual time spent at Fitzmall around 2 hours including test drive and drop-off of the rental.

  • avatar
    Bridge2far

    jimmy2x-
    Is it true that no other dealer in your area was within $1,700 of the internet delaer’s price? Are 4Runners that much in demand? I didnt think they were.

  • avatar
    Bridge2far

    Rod- Of the four vehicles you mentioned, the Explorer will offer the most selection and probably the most discount/value. I don’t know how many used CX 9’s or Enclaves you will find as they are fairly new vehicles. My guess is that a used Enclave at this point will most likely be an ex rental. You can check that with Auto Check or CarFax.

  • avatar

    Rod it was my friend not me that had that experience. I know how the game is played. I always do my research and know what approximate going rate is what a good deal is and what a steal is just in case it is put in front of me.

    I really love mangos you need to do the same research on the going prices on craigs list, auto trader ( I recommend print version), and your newspaper classifieds. This will give a you a feel for the range. Know that all the dealer ads are generally already inflated. Know the difference between wholesale and retail. Wholesale is the real value of the car. You will pay that plus the dealer still has to make a profit.

    Never tell them you will pay cash. The dealer wants to make their financing profit. Don’t say anything just say yeah I’ll finance it if you can get me a good rate and hand them your license. They will check your credit score and if its good (it probably is if you are a cash buyer) and they will fight over you.

    Go ahead and finance it through the dealer (just make sure there is no prepayment or early payoff penalty there usually isn‘t) just pay the loan off early and you still save all the interest charges.

    Act like an idiot but know what a good price for the car you want is and stick to it (but remember the dealer has to make something) Allow the sales manager (not the salesman) to bump you a little (a hundred bucks from your initial offer) make sure you spend at least an hour in the haggle cubicle and don’t leave in a huff. This will let them know you are a serious buyer. When you don’t get your price ( and you usually won’t) leave. They’ll call you back the next day and agree to your price (so make sure as soon as you meet the salesman that they get your name and phone number.

    That’s my advice. Its also why I hate the game. Why can’t I just buy a car like every other mass produced item? Oh well good luck

  • avatar

    We have a Fitzmall down here in Florida too and I have heard nothing but good things about them

  • avatar
    ireallylovemangoes

    Bridge2far

    The CX-9 I am looking at is an ex-rental. What is wrong with purchasing a rental if it is still under warranty? My current ride is a ’99 Taurus wagon that was an HP fleet car for 10 months before I bought it and it has been a great car.

    Sherman, thanks for the advice.

  • avatar
    no_slushbox

    Sherman Lin:

    +1 on not bragging about paying in cash. People are so proud of the fact that they have enough money to pay in cash that they let go of reason.

    Also, a lot of people probably don’t know that, for many dealers, financing is more profitable than selling the actual car.

    I don’t think people need to go through the hassle of actually financing with the dealer though.

    I would just tell the salesperson, yes, I’m interested in financing. Then at the point that the price is agreed on and I am in the finance guy’s office I would just say your rate is not low enough, I’ll pay cash.

    I actually think that the haggling is a good thing for people that know what they are doing. The fierce competition between same brand/company dealers is part of what is driving the big-3 out of business, but it’s good for prices.

  • avatar

    I_hate_mangos By the way if you follow my method at several dealerships, every one of them if they don’t sell you the car at your price will say x is the best price we can sell if for. You can always go back and buy it at x dollars. I always start at the dealership furthest away from me and work my way back to the closest to home. This will help you practice and if nothing else you can say beat x dollars to the one closest to home if you are in a hurry but I always got my price which was always at least 1000 dollars under their alleged best price but I never could get them to agree on my first visit. I was always called at home the next day or even on the same day by the dealership to come back they agreed to my price.

  • avatar
    ronin

    “You can feel a significant shift in the last couple of weeks,”

    Congratulations! That’s just great. Now GM and Cerberus and GMAC can pay back their ‘loans’ to us early. And naturally they won’t be needing any more free ‘loans’ in the coming months.

  • avatar
    jimmy2x

    Bridge2far :
    Is it true that no other dealer in your area was within $1,700 of the internet delaer’s price? Are 4Runners that much in demand? I didnt think they were.

    Purchase was in May. List price was $41,300 for 6 cyl LTD with NAV. Toyota cash back = $1500. Actual purchase price was $35,400 plus taxes, tags, and $99 dealer fee. Closet price around here was app 2K higher.

  • avatar
    porschespeed

    Typical dealership nonsense, and sadly Sherman’s friend had a typical experience.

    One of my friends is interested in a Challenger. We all know that they are piled deep across the country, and in fact, piled deep in his local dealer’s lot.

    Walks in the door and starts talking to the salesman. Salesman says they’re just flying out the door, the 30+ that have been sitting there for weeks are mostly sold, “just waiting to be picked up”. Oh yeah, and if you want one it’s over sticker. We won’t budge.

    This exact dealership has been trying to hawk even the most desirable ones on evilBay at sticker, to little avail.

    My friend points this little factoid out and then walks out the door.

  • avatar
    davemurphy

    Finding the right dealership is more important than the new car you buy. I was looking around fairfield county and found a website devoted to Bashing Fairfield Audi… This guy goes out of his way to build an entire website detailing his experience logged for all to read. What this guy went thru was a nightmare.

    I think shopping for cars is easier now… there are so many resources… You have your green car awards posted almost daily now ; ) EPA also released their rubric of the most and least efficient cars (hybrid, diesel and regular included), which got some press…

    http://www.fueleconomy.gov/FEG/bestworst.shtml

    And there’s also sites ranking vehicles on environmental and aesthetic impact.like http://www.carfunfootprint.com

    I think as soon as there is more consumer confidence people will start opening up their checkbooks again. My first luxury purchase is going to be a vacation.

    Dave

  • avatar
    RedStapler

    The car buying game is what it is.

    It can be incredibly lucrative to the stealership to when they get people who are weak willed. From worst case to best case it can mean the difference between a $500 to $5000 profit.

    I had to go back and forth with the one dealer in my town that had the model I wanted for about 10 days when I bought my Jeep back in 06.

  • avatar
    TheRealAutoGuy

    I would like to humbly suggest a visit and interview with a few car dealers. Print it all, or at least most of it, and you’ll get the truth.

    Isn’t this site about getting to “The Truth?”

  • avatar
    porschespeed

    @TheRealAutoGuy,

    I would humbly suggest that if you are looking data that can be argued in any way, shape or form to be “the truth”, you have to actually do a study.

    Doing an interview with a dealer will get you an interview. Which is always a sell job. Even if you are waterboarding the interviewee.

    Pretty simple study, pick maybe 6 demographic groups, Caucasian M/F/couple. Do the same for African-American. Pick 50 dealers, variety of manufacturers in variety of neighborhoods. Every one of our ppl/groups will visit all 50 dealers. Same clothes, drive up in same car, follow same script every time.

    Covert video and audio of whole show (easy and cheap to do these days).

    Transcribe the whole bloody mess, and post the video.

    Or, you could just look at the facts on the ground. Which undeniably conclude that most consumers on the whole, have a better experience with ‘transplants’ than with ‘domestics’. Consumers have voted with their wallets, which is the only “truth” that really matters in business.

  • avatar
    TheRealAutoGuy

    Porschespeed,

    Good post, good insight.

    A couple of closing thoughts: Your name would seem to indicate your preference. I tend to like things produced on this side of the Atlantic a bit more; but hey, vive la difference! :-)

    GM’s Saturn dealers are without a doubt or industry argument some of the finest dealers in the world — consumers consistently rate them at or near the top of the heap. In a world of seeming contradictions, many of us in the US auto business find it a cruel irony that Saturn would be on the block at the time when they have A: great dealers, and B: great products, albeit late.

    This is not to say that people should blindly buy Saturns, but just as logically, based on dealer and product performance, it is incorrect to say that European and Asian vehicles are the only ones worthy of consideration.

    Which is pretty much my original point: Come at an issue from many sides, listen to lots of folks, including those you may not initially agree with, and you may — may — approach the truth. :-)

  • avatar
    porschespeed

    @TheRealAutoGuy,

    Well the handle is kind of a giveaway, but I am not enamored of all their product offerings (ie, the UberBeetles)…

    ‘Tis a shame about Saturn. Had GM actually applied the Saturn model to the rest of the business, things could have been much, much different.

    Saturn really had a chance to take back a good chunk of the small car market. Talk about shooting off all of your lower extremities. Ugh.

    You are right, of course. Euro/Asian stuff is not the only thing worthy of consideration. Some of it is utterly overrated.

    Regardless of whether we all agree or not, as you’ve noted, the more we all know, the closer to the truth we all get.

  • avatar
    supremebrougham

    I visited Draper’s several months ago. To hear them talk, and from the looks of their lot, you would think all was well with the world…trucks and SUV’s everywhere, and everybody wants them!!! (or so you are led to believe)

    Some of you might have noticed a little over a week ago I posted on another story that I was looking at purchasing a used Ford Fusion. Well, I went to look at it. I had to drive almost three hours to see it. It was at a Toyota dealer in Waterford, MI. They knew I was coming, and had the car sitting in front of the building waiting for me. When I got into it, it was FILTHY!!! Mud was all over the dash, the door panels, and the A pillar! Food and hair was all over the seats and there was coffee or pop spilled down the side of the console and onto the carpet. I was appalled!!! The car itself was fine, but I was really put off by the appearance. After that, I told the dealer that I only had so much time. They first pulled the “hold my keys” routine, then they lowballed my trade by $1500. But what infuriated me was when I pointed out that after they would “give” me $4000(I blue booked it at $5500) for my car and then turn around and sell it for $7000, the salesman told me “Well we are part of the Penske Automotive Group, and we have over 1000 dealers and by the time we get your car checked out we will have over $1000 in it.” My car is immaculate, and needed nothing more than a wash and light vaccuuming (due to it being winter) and a simple inspection. What their association with Penske had to do with that is beyond me! They kept me there over three hours and after telling me “we can get into it for around $280/month, they finally said as I was leaving “we got you down to $239! By then I just didn’t care anymore. I was really disappointed that a Toyota dealership would use such tactics. Oddly enough though,I did decide to put a Toyota back on my short list of potential new (to me) cars, along with the Fusion, but I’m not planning on returning to Waterford to that dealership. Oh, and FWIW, they never called me after they said they would this week…

    Thanks for letting me vent.


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