Subaru to switch to quarterly U.S. sales reports

Subaru of America follows Porsche, Nissan, Mitsubishi and BMW this year in making the change.

source https://www.autonews.com/sales/subaru-switch-quarterly-us-sales-reports

In pursuit of wholesale inventory, from far or near

Inventory shortages have left many dealers eager to snap up used vehicles wherever and however they can. Unfortunately for those dealers, the desire for inventory has also led to higher wholesale prices.

source https://www.autonews.com/retail-technology/pursuit-wholesale-inventory-far-or-near

Ford Promise debt relief program launches

Ford Promise allows Ford Credit to buy back a vehicle at its average trade-in value plus up to $15,000. If the amount owed is more than the program limit, the customer is responsible for the difference along with the cost of late or deferred payments and vehicle damage.

source https://www.autonews.com/sales/ford-promise-debt-relief-program-launches

Ford Promise debt relief program launch

Ford Promise allows Ford Credit to buy back vehicles at its average trade-in value up to $15,000. If the amount owed is more than the program limit, the customer is responsible for the difference along with the cost of late or deferred payments and vehicle damage.

source https://www.autonews.com/sales/ford-promise-debt-relief-program-launch

Mercedes' conclusion about its subscription trial? In a word: Meh

Mercedes-Benz USA this summer will halt its two-year vehicle subscription pilot, which it described as a learning exercise to determine whether the model could attract new and younger customers.

source https://www.autonews.com/sales/mercedes-conclusion-about-its-subscription-trial-word-meh

VW CPO sales set May record

Volkswagen's 650 U.S. dealers sold a record 11,087 certified pre-owned vehicles in May, thanks to an aggressive financing offer from Volkswagen Credit to help dealers and consumers during the COVID-19 pandemic.

source https://www.autonews.com/retail/vw-cpo-sales-set-may-record

Rosenberg fails to block store sales again

A Massachusetts judge has denied David Rosenberg's injunction seeking to block the sale of certain Prime Automotive Group dealerships and restore him as dealer principal of them.

source https://www.autonews.com/dealers/rosenberg-fails-block-store-sales-again

Dealer anniversaries

40 with BMW

John Antonino, right, president of Antonino Auto Group, receives a 40-year award for BMW of New London in Connecticut, from Tom Shanley, regional vice president for BMW of North America.

source https://www.autonews.com/dealers/dealer-anniversaries-50

In retail, jobs may be gone for good

Even as retail sales came roaring back in May and June, there is reason to believe the rush might be temporary. The trends might trigger permanent changes to dealership staffing models.

source https://www.autonews.com/dealers/retail-jobs-may-be-gone-good

Digital auctions may not be permanent shift

As more buyers return to auction lanes, the appetite for both physical and digital sales is obvious.

source https://www.autonews.com/retail/digital-auctions-may-not-be-permanent-shift

Resurgent virus may slow sales recovery

Demand bounced back quickly after big drops in March and April, but record numbers of cases in California, Florida and Texas could hamper the upward trend.

source https://www.autonews.com/sales/resurgent-virus-may-slow-sales-recovery

Failed Calif. law would have strained auto finance market, group says

During the coronavirus pandemic, federal, state and local governments have introduced measures designed to prevent the spread of the deadly virus, preserve economic stability and provide for Americans hardest hit by the crisis. Measures at every level have been criticized as being too harsh, too lax, overreaching and incomplete, depending on regional variances.

A failed consumer protection law in California exemplifies contentious legislation in the time of the coronavirus. The American Financial Services Association believed the rule, AB 2501, which the California Assembly declined to approve before it adjourned last week, would have caused more harm to auto lenders and borrowers in the long run.

The COVID-19 Homeowner, Tenant and Consumer Relief Law of 2020 — first introduced in February — would have required creditors to provide up to nine months of vehicle payment relief, suspend repossessions for two years with some exceptions and offer one year of mortgage payment relief in one of the nation's largest automotive markets. The law also would have capped the rate of interest that could be applied to the consumer's auto loan account at 7 percent a year.

The legislation was meant to aid consumers in a sweeping gesture, though the American Financial Services Association and its members saw the potential for the opposite to occur. The organization argued that if banks can't repossess a vehicle or take payment for an auto loan, it would effectively turn the auto loan — a secured credit obligation — into an unsecured loan. This, according to the group's recent blog post, may have resulted in ratings organizations downgrading vehicle asset-backed securities and "certainly would have led to a collapse in confidence in the marketplace."

"The legislation, while well-intentioned, would have created greater economic hardship for consumers and businesses alike by limiting consumers' access to credit and undercutting confidence in some forms of asset-backed securities in the capital markets," Senior Vice President Danielle Fagre Arlowe said in a statement.

Capping interest rates on auto loans prevents lenders from working with lower-credit customers at risk of default. High interest rates on these loans are considered a viable method of offsetting potential losses from riskier originations.

In this unprecedented time, legislative bodies must work together with industry leaders and citizens to develop workable solutions in the crisis. And lenders should continue working out forbearance strategies with their customers based on individual needs.

source https://www.autonews.com/fi-blog/failed-calif-law-would-have-strained-auto-finance-market-group-says

COVID-19 top concern for N.Y. dealership association's new head of compliance

Thomas Higgins, the incoming director of compliance at the Greater New York Automobile Dealers Association, spoke with Staff Reporter Jackie Charniga about his priorities in his new role, the state's regulatory environment and his experience working with automotive dealerships.

source https://www.autonews.com/finance-insurance/covid-19-top-concern-ny-dealership-associations-new-head-compliance

In dealer ads, to wear a mask or not to wear a mask?

Showing masks is a key piece in dealerships' efforts to convey a dedication to safety and cleanliness. But some consumers see it as a political statement.

source https://www.autonews.com/marketing/dealer-ads-wear-mask-or-not-wear-mask

OBITUARY: William Proctor Jr.

Dealer William Proctor Jr. died June 15 at age 88. In 1957, he joined the family business started by his father and uncle.

source https://www.autonews.com/dealers/obituary-william-proctor-jr

Ditch silos to improve digital selling

As dealers simplify operations, it's smart to take a closer look at how digital resources can seamlessly link different steps of the sales process through a single point.

source https://www.autonews.com/commentary/ditch-silos-improve-digital-selling

2021 NADA Show in New Orleans to go on

The 1.1 million-square-foot Morial Convention Center is big enough to give January’s show a variety of spacing options amid the uncertainty stemming from the coronavirus pandemic, Chairman Rhett Ricart said.

source https://www.autonews.com/dealers/2021-nada-show-new-orleans-go

Buy-sells drop off, but outlook is positive

Dealership buy-sell experts say transactions in the first quarter slowed as the pandemic took hold. Some expect more activity in the second half of the year.

source https://www.autonews.com/dealers/buy-sells-drop-outlook-positive

CarMax sales, profits drop in pandemic-hit quarter, but outlook improves

More than 80 percent of the used-vehicle retailer's days in the quarter were negatively impacted by store closures and limited operations but the company said business has been recovering.

source https://www.autonews.com/dealers/carmax-sales-profits-drop-pandemic-hit-quarter-outlook-improves

New Rogue barrels forth, sans hybrid

When the 2021 Nissan Rogue arrives in U.S. stores this fall, it will not offer a hybrid powertrain. Nissan isn't worried.

source https://www.autonews.com/cars-concepts/new-rogue-barrels-forth-sans-hybrid

Walmart’s self-driving partner is changing e-commerce economics

In a world of moon-shot technology, billion-dollar capital rounds and promises to disrupt transportation as we know it, Gatik’s ambition is humble. Its slow-lane approach has proved to be pragmatic and lucrative. Walmart signed on as one of its first customers last year.

 

source https://www.autonews.com/mobility-report/walmarts-self-driving-partner-changing-e-commerce-economics

CarMax sales and profits drop in pandemic-hit quarter, but outlook improves

More than 80 percent of the used-vehicle retailer's days in the quarter were negatively impacted by store closures and limited operations but the company said business has been recovering.

source https://www.autonews.com/dealers/carmax-sales-and-profits-drop-pandemic-hit-quarter-outlook-improves

Cox cuts about 275 jobs amid pandemic woes

The cuts are the first permanent job reductions stemming from the pandemic at the dealership technology company , which is facing a sharp decline in 2020 revenue.

source https://www.autonews.com/retail/cox-cuts-about-275-jobs-amid-pandemic-woes

F&I product provider launches flexible mileage service contract

EFG Cos.' Motorist Assistance Plan vehicle service contract can be customized in 2,500-mile increments, allowing finance-and-insurance managers to pitch the contract much closer to a customer's driving habits.

source https://www.autonews.com/finance-insurance/fi-product-provider-launches-flexible-mileage-service-contract

Unchanged Fed rate signals pessimism for 2020's second half

The Federal Reserve stayed the course on the benchmark interest rate last week, highlighting expectations for a rough road ahead for the U.S. economy. Until the coronavirus crisis ends, the lending environment will likely remain under duress.

Opportunities remain in the new-car market — but one economist says inventory challenges, a tighter credit environment and high unemployment rates will hinder sales.

The benchmark rate, which directly impacts auto lending, is a litmus test for the health of the lending market. The nation's central bank cut rates to zero in mid-March to ease the flow of credit as the coronavirus ravaged key U.S. auto markets. Auto loan rates have largely benefited from the drop, though Cox Automotive's chief economist, Jonathan Smoke, noted in his blog that subprime buyers remain challenged in credit access.

"Lower rates are helping to drive down average loan payments, but the consumers getting those lower payments are much more likely to have the best credit scores," Smoke said.

Automakers continue to pull back on the incentives that drove down interest rates charged on new-vehicle loans in April and May.

There has also been substantial tightening in the credit market, Smoke noted, as lenders attempt to shield themselves from losses down the line by restricting access to consumers with riskier credit.

Another concern is that the pent-up demand retailers are banking on may be less of a flood and more of a trickle. The aggressive automaker incentives may have moved metal in March and April, but it also could have cannibalized consumer demand as it pulled ahead buyers. For the rest, Cox Automotive cites 36 percent of potential customers are delaying their automotive purchases, citing market uncertainty and fear of unemployment.

Dealerships should brace themselves for a rough second half to 2020.

source https://www.autonews.com/fi-blog/unchanged-fed-rate-signals-pessimism-2020s-second-half

As new-car demand returns, leasing levels refuse to rally

Leasing, which comprises nearly one-third of new-vehicle sales, dropped in April to the lowest levels since 2015 as the coronavirus pandemic collapsed the top two leasing markets in the country and automakers saturated the market with loan incentives. Rising customer demand prompted automakers to pull back on many of those programs, but leasing levels remain well below normal.

Leasing levels fell to 24 percent in April, Experian said, down from 30 percent in April 2019. The last time the levels were below 25 percent was in the fourth quarter 2014.

Discounting auto loans is cheaper for automakers than leasing, said Melinda Zabritski, Experian's senior director of automotive financial solutions, so pulling back on leasing for the near-term makes sense. She said it is "hard to tell" when normal levels will return. "I have a hard time speculating because this is so unprecedented," Zabritski said.

As leasing levels dropped, shares of 0 percent-interest, 84-month loans as part of total auto originations rose sharply in March, peaking at 22 percent in the week of March 29, J.D. Power said. Steeply incentivized auto loans have been steadily falling each week since, comprising only 12 percent of originations in the first week of June.

Leasing levels rose gradually during this time but hit a plateau at 25 percent of auto originations for three consecutive weeks.

source https://www.autonews.com/finance-insurance/new-car-demand-returns-leasing-levels-refuse-rally

With new inventory on the decline, now is CPO's time to shine

During the Great Recession in 2009, more than 8 in 10 vehicles sold in the U.S. were used. Online car-shopping behavior indicates this trend is picking up again. Used-vehicle traffic to Edmunds has skyrocketed.

source https://www.autonews.com/blogs/new-inventory-decline-now-cpos-time-shine

Sonic updates Q2 outlook amid improving used-vehicle sales

The rise in used-vehicle sales is part of a steady increase in overall operations since the onset of the coronavirus pandemic in March.

source https://www.autonews.com/dealers/sonic-updates-q2-outlook-amid-improving-used-vehicle-sales

CDK Global finance chief to take new COO position

Joe Tautges, 44, will move into the newly created role once a new CFO has been hired.

source https://www.autonews.com/executives/cdk-global-finance-chief-take-new-coo-position

Dealer Anniversary

The dealer featured this week is Dennis Lin, dealer principal of Century West BMW in North Hollywood, Calif.

source https://www.autonews.com/dealers/dealer-anniversary-4

Used wholesale prices up ? now what?

Dealers are seeing strong demand for used vehicles — and high prices to acquire them.

source https://www.autonews.com/used-cars/used-wholesale-prices-now-what

Inventory drops off as buyers return

Automaker and dealer inventories were estimated to have dropped to around 2.65 million vehicles as buyers returned to dealerships before production had a chance to fully ramp back up.

source https://www.autonews.com/retail/inventory-drops-buyers-return

Reynolds CEO allegations exposed in Bermuda case

A former employee alleges in a civil case that Bob Brockman, head of the largest private dealership management system company in the U.S., is under criminal investigation on suspicion of tax evasion and money laundering.

source https://www.autonews.com/dealers/reynolds-ceo-allegations-exposed-bermuda-case

Meeting new challenges ? and still growing

Principle Auto CEO Abigail Kampmann discusses the lessons her Texas dealership group is learning from the pandemic.

source https://www.autonews.com/dealers/meeting-new-challenges-and-still-growing

Vroom stock finds an appetite for disruption

The company is looking to take a share of the massive and fragmented used-vehicle market from bricks-and-mortar dealers and the peer-to-peer market.

source https://www.autonews.com/used-cars/vroom-stock-finds-appetite-disruption

Germ-free cars are nice, but nothing tops low price

Now that many states are slowly reopening, will service customers begin booking appointments at their dealerships?

source https://www.autonews.com/fixed-ops-journal/germ-free-cars-are-nice-nothing-tops-low-price

Dealerships will need technicians as pandemic subsides, business returns

Concerns over the auto retail industry's chronic shortage of service technicians have taken a back seat during the coronavirus shutdowns. But the issue isn't going away.

source https://www.autonews.com/fixed-ops-journal/dealerships-will-need-technicians-pandemic-subsides-business-returns

Collision repairs have tanked, but that doesn't mean it's time to sell

Dealers who are pondering an exit from the collision business because of the pandemic-induced reduction in accidents should first weigh the advantages they have.

source https://www.autonews.com/fixed-ops-journal/collision-repairs-have-tanked-doesnt-mean-its-time-sell

Mobile recall fixes help keep dealership rolling

Ed Roberts added his second mobile service van on March 11. It has become an $80,000 tool for picking up recall work at Bozard Ford-Lincoln in St. Augustine, Fla.

source https://www.autonews.com/fixed-ops-journal/mobile-recall-fixes-help-keep-dealership-rolling

Facebook ads help dealership's sales

A recent shift in advertising strategy to focus on the social networking platform turned Power Ford into a major player in its market and is helping to prop up sales when many consumers are spending more time at home.

source https://www.autonews.com/best-practices/facebook-ads-help-dealerships-sales

COVID-19 moves pickup and delivery into mainstream brands

Pickup and delivery of customers' vehicles has emerged as one of the most effective ways fixed ops directors can keep their service bays busy while reducing the risk of exposing service advisers, techs and cashiers to the virus.

source https://www.autonews.com/fixed-ops-journal/covid-19-moves-pickup-and-delivery-mainstream-brands

How dealership collision shops can position themselves for a rebound once roads are busy again

How collision shops can position themselves for a rebound once roads are busy again

How dealership collision shops can position themselves for a rebound once roads are busy again

Dealership collision shops are dealing with a sharp decline in business as Americans cut down on travel during the coronavirus pandemic. Experts say now's the time to make sure the shop is ready for a rebound.

source https://www.autonews.com/fixed-ops-journal/how-dealership-collision-shops-can-position-themselves-rebound-once-roads-are

Automakers, dealerships see mobile service as investment in customer loyalty

Some dealers are convinced he's found a way for his service department to broaden its reach.

source https://www.autonews.com/fixed-ops-journal/automakers-dealerships-see-mobile-service-investment-customer-loyalty

Hospitality industry ripe for fixed ops recruiting

Service departments looking to replace talent lost in the coronavirus pandemic might find the best prospects outside the auto industry.

source https://www.autonews.com/fixed-ops-journal/hospitality-industry-ripe-fixed-ops-recruiting

This could be a great time to hire women in service ? here's how

The coronavirus pandemic just might offer a make-lemonade-from-lemons moment, especially if many furloughed employees don't return.

source https://www.autonews.com/fixed-ops-journal/could-be-great-time-hire-women-service-heres-how

Ohio State coaches were his focus group

Rick Ricart, president of Ricart Automotive Group based in Columbus, Ohio, uses his own staff to pick up and drop off cars.

source https://www.autonews.com/fixed-ops-journal/ohio-state-coaches-were-his-focus-group

Service customer denied award

The Texas Court of Appeals has refused to reinstate a $25,236 jury verdict in favor of a service customer whose 2006 Chevrolet Equinox was hit by another vehicle backing out of a service bay.

source https://www.autonews.com/fixed-ops-journal/service-customer-denied-award

Fixed in time

In 1937, service and sales were a lot closer than today.

source https://www.autonews.com/fixed-ops-journal/fixed-time-7

Service counter

Total parts and service sales in U.S. dealerships reached $120.73 billion last year, up 3.6% from 2018, thanks to 311.6 million repair orders. Here are some other fixed ops figures for 2019 from the annual NADA Data financial profile.

source https://www.autonews.com/fixed-ops-journal/service-counter-7

Employees will find new processes and mindsets are required post-COVID

Furloughed fixed ops employees who return will likely find their jobs are quite different from the ones they left. Furthermore, the work will demand new skills and mindsets, including more technical proficiency and an ability to adapt to change.

source https://www.autonews.com/fixed-ops-journal/employees-will-find-new-processes-and-mindsets-are-required-post-covid