Category: Dealer News

By on March 30, 2020

Auto dealers and manufacturers around the globe have spent the past several years examining the usefulness of digital car sales, but the practice hasn’t been embraced as warmly in the United States, where state franchise laws often prohibit direct sales from automakers to anybody but a licensed auto dealer. Critics say this allowed retailers to become middlemen that customers are forced to haggle, while advocates explain that the system promotes U.S. jobs and provides a local resource for those needing repairs.

Neither are incorrect, yet dealerships have continued to buck online sales, even after manufacturers attempted to work with them on various pilot programs.

With COVID-19 keeping a large portion of the American population at home, dealers are revisiting online sales as a way to cut their losses. Digital transactions now look to be a necessity if shops hope to survive a prolonged pandemic. While many see this as a temporary measure, once the genie is out of the bottle, he’s difficult to put back inside… and may be far less benevolent than we’d like — even if we’re desperately in need of one of those wishes.  Read More >

By on March 23, 2020

BMW dealers are having a problem with the 8 Series. The returning flagship appears to be a bit too rich for North American tastes and retailers are growing annoyed.

According to Automotive News, retailers are upset that BMW didn’t issue enough marketing support to make the public aware that it even exists, and feel that the amount of configuration available works against the vehicle. As a result, many dealerships are sitting on expensive halo vehicles nobody seems to want; the 8 Series now has the highest day supply of any BMW model currently produced.  Read More >

By on March 20, 2020

Like every other business in the United States, auto dealers are attempting to implement changes that would allow them to operate safely amid the coronavirus outbreak. Undoubtedly petrified by the massive hit the Chinese car market took after COVID-19 reared its ugly head in Wuhan, they also hope to remain open while other business stay closed.

On Tuesday, the National Automobile Dealers Association (NADA) and Alliance for Automotive Innovation (AAI) issued a formal letter requesting that President Trump consider dealerships and service centers as “essential operations when federal, state, and local officials impose certain requirements due to the coronavirus outbreak.” While we’ve already seen dealerships embrace new tactics to comply with public health initiatives, it’s assumed they’ll be shutting down just, like most automakers plan to. However, retailers worry their diminutive cash reserves (in relation to manufacturers) won’t see them through a prolonged shutdown while the broader industry wonders who will repair automobiles during the pandemic.  Read More >

By on February 21, 2020

The annual Automotive Franchise Activity Report asserts that the number of new-car dealerships in the United States has shrunk for the first time since 2013. The difference is marginal when viewed from a national perspective, but could support prior theories that larger dealer networks are consolidating while smaller, less competitive shops are being forced out of the market. The report claims the total number of storefronts fell from 18,294 in 2018 to 18,195 at the start of 2020. Dealership throughput was similarly down, decreasing by eight units from 2018 to 940.

While not particularly alarming, the figures do seem to mirror national population trends when placed under a microscope. The states that lost the highest number of showrooms  tended to be regions that had the most trouble preventing people from moving.  Read More >

By on January 23, 2020

The extended UAW GM strike of 2019 was the longest the automotive industry endured in a couple of generations. At the time, General Motors said the situation would delay production across its entire model lineup, including the 2020 Corvette. The mid-engined C8 is all-new, encouraging plenty of interest. It was assumed the model was destined to be sold out months before the strike occurred.

While GM later confirmed models were still available, it warned that the strike might delay its launch and could impact dealer allocations. In November, the manufacturer said the C8 wouldn’t arrive until February of 2020, though the latest word from retailers indicates GM will cut back on allocations of the C8. Read More >

By on December 18, 2019

The National Automobile Dealers Association (NADA) released its annual new-vehicle sales forecast for 2020, estimated a modest decline in U.S. volume. The announcement dropped on Tuesday, citing rising transaction prices as the probable cause. With fewer sedans on the market (especially among domestic automakers), customers are shifting to crossover vehicles with higher price tags. Fortunately, the United States’ economy has remained roughly as stable as the cost of fuel — avoiding market conditions that normally encourage customers to swap into affordable economy cars or simply hold onto their current ride.

“We expect new light-vehicles sales will come in at 16.8 million units for 2020, roughly a 1.2 percent drop from 2019 sales volume,” NADA senior economist Patrick Manzi explained. “As for 2019, it appears new vehicle sales will best the expectations of most in the industry by topping 17 million units for the fifth straight year.” Read More >

By on September 4, 2019

lincoln navigator grille badge lincoln logo

My father has historically been a Ford man. Despite numerous forays into Chevrolet, Chrysler, Volkswagen and Toyota, he has always returned to the Blue Oval when the time came to purchase a keeper. Other nameplates came and went, receiving slightly less attention, but there was always at least one well-maintained Ford in the garage. As a result, I became familiar with dealerships using the suffix “Ford Lincoln Mercury” at a very young age.

For me, it was an opportunity to ogle the fancier sedans my father claimed didn’t make financial sense. “It’s the same car,” he would always say. “This one just costs more.”

When you’re eight and have nothing to distract yourself with other than the swizzle sticks you stole from the coffee area, fatherly advice has a way of sinking in. I’ve often wondered why automakers would even dare place their premium offerings so close to their less-expensive models. But times have changed.  Read More >

By on August 22, 2019

On Saturday, Nissan’s North American dealerships found themselves with a problem. A power outage at the automaker’s data center in Denver disabled a system dealers use to order vehicles, procure parts, check on recall statuses, obtain rebate information, and file warranty claims. As a result, the manufacturer’s communications in the U.S., Canada, and Mexico were disrupted. “Some of our dealer business applications have run in a reduced capacity using manual processing,” Nissan said on Wednesday.

Dealers were not pleased. Read More >

By on August 20, 2019

It’s no secret that Volvo dealers aren’t keen on the factory subscription plan. Last December, the California New Car Dealers Association even asked the manufacturer to end Care By Volvo on the grounds that it was taking business away from storefronts. The automaker responded by saying the service had proven popular with consumers, attracting new customers to the brand while reassuring dealers that version 2.0 of the subscription plan had been approved by the Volvo Retailer Advisory Board and would give shops more to do.

Rather than take the wait-and-see approach, the California New Car Dealers Association petitioned the state’s New Motor Vehicle Board. Last week, the group unanimously voted to direct the state’s DMV to investigate Care by Volvo and four claims that the service violates provisions of the California vehicle code — potentially leading to disciplinary actions.  Read More >

By on June 28, 2019

2019 Mercedes-Benz G-Class Camo

When it comes to buying new cars, I don’t have much patience. When I bought my Focus RS in 2016, I spent less than an hour doing the whole deal, including actually deciding what car I wanted to buy. Got a blank check approval from my bank, spitballed some ideas with my older brother and my good friend Bozi, and then put down a deposit on a car at a dealership about a thousand miles away. But there was one time when I tried to have patience, and was sorely disappointed.

Eleven years ago, I put down a $5,000 deposit and placed an order for a BMW 135i with my local BMW dealer. It was the launch year for the ill-fated 1 Series in the states, and I wanted to have one of the very first Ones to hit our shores. I ordered a very stripped down version — black, stick shift, cloth seats, no roof. After about 12 weeks, the dealer called to let me know that my car had arrived. Well, a car had arrived… but certainly not mine.

This example was an automatic. But that wasn’t the only thing they got wrong. They added somewhere in the neighborhood of $5k to the sticker, including nearly every option, even a red leather interior. Imagine my disappointment and frustration with the dealer, who had recycled sales people a couple of times since my order and couldn’t seem to track down anything about it, not even the original order sheet.

I asked for my money back, which they reluctantly gave me, and I ended up buying a Pontiac G8 GT instead — not a bad trade. But not everybody who goes through the ordering process is so fortunate. Click the jump for a question from our friend Andy about his experience in ordering his own custom German whip.

Read More >

By on April 8, 2019

U.S. light-vehicle dealers reported an operating loss for the first time since the National Automobile Dealers Association (NADA) began collecting data in 2009. While everyone continues reporting pretax net profits, concerns are beginning to swell around their dependency on factory incentives, which are not included in operating tabulations.

NADA’s analysis of 2019’s first-quarter auto sales shows that incentive spending is down compared to the same period a year ago. The group expects above-average discipline from automakers in terms of incentive spending throughout the year. According to J.D. Power, average incentive spending per unit was down $119 to $3,821 through March 2019 — with the brunt of that going toward trucks. However, if sales remain low, spending may creep back up to help clear out languishing inventories.  Read More >

By on March 25, 2019

Dealers got an early look at a prototype build of the upcoming Ford Bronco. Gathered in Palm Beach, FL at the behest of the automaker, dealers were asked to hand over their phones in order to avoid any leaks. Fortunately, their memories were sufficient in giving us a better idea as to what to expect come 2020.

While the event’s focus stayed on the Bronco and some of its more-interesting features, Ford also shared its plan to develop a family of off-road vehicles to complement the model. Introductory vehicles include the Bronco, its smaller counterpart, and a little unibody pickup to slot beneath the Ranger.  Read More >

By on February 19, 2019

When I was a lad, there were two family-owned and operated dealerships within walking distance of my home. Upon reaching driving age, one had already closed while the other began adding storefronts in different towns. It now has three locations, ensuring a meaty inheritance and lifelong job security for several members of my graduating class.

It’s the nature of the free market and a familiar story. According to an assessment from the National Automobile Dealers Association, singular showrooms have gone from 7,514 strong to just 4,904 between 2008 and 2018. That’s a 35-percent decline, whereas the number of dealers with 10 or more stores increased 62 percent over the same period.  Read More >

By on January 28, 2019

lincoln navigator grille badge lincoln logo

Last year, Ford announced its intent to develop a rewards program aimed at keeping customers engaged — while also making it worth their while to stick with the brand for their next purchase. While customer rewards are old hat, regardless of industry, automakers are busy devising new ways of using the venerable marketing theory to improve customer retention. It’s an urgent gambit, given today’s cooling market.

General Motors launched its “My GM Rewards” loyalty program in 2018, using a points-based system to reward customers who use OnStar’s new services, purchase a new vehicle, or service an older one. Those points can then be redeemed, knocking some cash off a subsequent GM purchase. Meanwhile, Honda previewed “Dream Drive” at the recent Consumer Electronics Show — a concept with its own redeemable points system (one that incorporates some potentially unsettling gamification within the app).

While Ford’s FordPass-based efforts appeared similar, it wasn’t until this month’s North American Dealers Association (NADA) meeting that the automaker was willing to flesh it out.  Read More >

By on January 28, 2019

While the closing day of the 2019 National Automobile Dealers Association meetup revolved around charitable opportunities, engineering equality in the workplace, and a talk from author, pro golfer, and USAF veteran Major Dan Rooney on the merits of personal accountability, the rest of the event focused more directly on the auto industry.

One of the larger announcements came from Jack Hollis, general manager of Toyota North America’s Toyota division, who told dealers that his company intends to introduce 19 entirely new, redesigned, or refreshed vehicles over the next three years — focusing on utility models, but not ignoring cars. Toyota and Hollis are adamant that the brand can take advantage of other manufacturers abandoning sedan sales by both keeping them in its roster and continuing to improve them. Still, they acknowledge that SUVs and crossovers are essential in wrangling today’s buyers.

The secret, according to Toyota, is having a diverse lineup. However, pure electrics (and maybe minivans) don’t make the list, at least until sales data makes a better case for them.  Read More >

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