The Dealership is your Playground
Visiting an auto dealership in pursuit of purchasing a brand new car is comparable to taking a child to a candy shop; (Except the merchandise is much more expensive.) At an auto dealership, there is a wide variety of inventory and you can choose from. You can choose the vehicle make, model, size, color and other features all based upon your budget.
Brand New Features
As technology advances, the features in new cars also continue to advance; state of the art features such as lane change assist, which is a warning system that alerts a driver when his or her car is unintentionally drifting from a lane of travel. Another example is autonomous parking, which allows a vehicle to essentially park itself by using cameras and sensors. Drivers only need to operate the foot pedals and listen to directions.
Ford has held the line on prices for the refreshed 2016 Explorer crossover, but a new top-of-the-line Platinum trim raises the ceiling on what a customer can spend for the hot-selling full-size crossover to well above $50,000.
Today Ford Motor Co. announced prices for a base 2016 Explorer will start at $31,595, the same as for a base 2015 Explorer. The loaded Platinum Explorer, new to the lineup for 2016, will start at $53,495.
The priciest version of the current 2015 Explorer is the Sport model, which starts at $43,995. All prices in this story include shipping.
The 2016 Explorer, introduced last week at the Los Angeles auto show, will go on sale next summer. Other trim levels include the XLT, starting at $34,295; the Limited, starting at $42,195 and the Sport, starting at $44,195.
The Platinum will join the Sport as the only Explorer models offered with Ford’s 3.5-liter EcoBoost V-6 engine, which offers turbocharging and direct injection of gasoline.
The Platinum trim level will come standard with such features as enhanced active park assist adding perpendicular, or angle, parking, a lane-keeping system and rain-sensing wipers.
The 2016 Platinum Explorer will have its own LED headlamps and signature lighting, Ford says. Also standard will be a dual-panel moonroof, premium silver-painted front and rear skid plate elements, and 20-inch wheels.
Inside, the Platinum vehicle gets its own brushed aluminum version of the Ford oval in the middle of the steering wheel.
The 2016 Explorer will come with a new version of Ford’s 2.3-liter EcoBoost four-cylinder engine. The 2.3 liter will replace the 2.0-liter EcoBoost four-cylinder currently offered.
More content
Jim Farley, Ford executive vice president of global marketing, sales and service, said during the Los Angeles show that high demand for the Explorer Sport showed support for a model with even more content.
“One thing we learned is we didn’t have enough upscale products,” he said.
The current-generation Explorer was introduced in late 2010 as a 2011 model and is built on a modified version of Ford’s D4 platform, which originated with Volvo.
SUV sales in the United States have increased 90 percent since 2008, and growth has been particularly strong at the upper end of the market, Farley said.
“You can see an explosion of sport versions,” Farley said.
Tough competition
Ford expects the Explorer to compete with the likes of the Jeep Grand Cherokee and GMC Acadia, which have top prices of more than $50,000.
Farley said the Explorer remains a crucial vehicle for Ford, which is bullish on the global growth of SUV sales.
“We’re on pace to sell more than 180,000 [Explorer] units in the U.S.,” said Farley, who takes a new job as president of Ford’s Europe, Middle East and Africa business on Jan. 1. In 2013, Ford sold 192,397 Explorers in the U.S. Ford sells the Explorer in more than 100 countries. It is assembled at Ford’s Chicago Assembly Plant.
Continued economic improvement, low interest rates and cheap gasoline will help new-vehicle sales rise more than 3 percent to nearly 17 million units next year, the most since 2005, according to forecasts from the National Automobile Dealers Association.
NADA sees U.S. new vehicle sales growing to 16.94 million units in 2015 from a projected 16.4 million this year, as U.S. gross domestic product grows 3.1 percent, compared with an estimated 2.1 percent this year.
Through October, the industry sold 13.7 million vehicles in the U.S., up 6 percent over the same period of 2013.
But sales will begin to plateau or even decline after 2015 as the growing number car buyers with five- to seven-year financing deals delay their next purchase to pay down those long-term loans, NADA’s chief economist says.
The monthly U.S. adjusted sales rate has topped 16 million vehicles for eight months in a row, and in August surpassed the 17.5 million mark, according to the Automotive News Data Center. The October rate was 16.5 million.
The National Automobile Dealers Association has rapped Nissan's knuckles for "actions by some Nissan representatives" to boost scores in a survey of dealer attitudes toward automakers.
In a July 24 letter to Nissan dealers, NADA said that over the summer it became alarmed that some Nissan field reps may have pressured dealers to give favorable responses on the NADA Dealer Attitude Survey.
"We want you to know that NADA considers any attempt to coerce you into giving responses that you don't believe in is unacceptable," the letter said. It said NADA can drop responses from areas where it determines that the survey has been "subverted."
A statement issued Friday, Sept. 26, by Nissan North America acknowledged NADA's concerns.
"We have cooperated fully with NADA during the survey process, and we understand that the organization will exclude any questionable surveys to ensure that the highest levels of integrity are maintained," the Nissan statement said. "Nissan does not condone manipulation of the NADA Survey, and we will take appropriate action against any party that is found to be interfering with this process."
NADA surveys dealers in winter and summer. The attitude survey is intended to be a confidential report card on dealer-factory relationships. NADA privately presents the survey results to automakers and dealers.
Nissan received low marks in the winter 2014 attitude survey, which signaled a decrease in the number of dealers who believed the value of the franchise would rise.
Nissan's top U.S. management has responded to retailers' gripes by declaring a mission of "making our dealers happier and more profitable" in the words of Jose Munoz, Nissan's North American chairman. Last year, Munoz launched a newly designed sales-incentive approach that addressed dealer complaints that Nissan's previous stair-step program was too unpredictable.
Munoz is determined to raise the value of Nissan dealerships and improve the general perception of Nissan among retailers.
Munoz has said that by making Nissan stores more profitable, multifranchise dealers will give Nissan their top business priority.
NADA did not specify what transpired in the field to raise its concern. The association told dealers that it uses "a number of confidential methods to ensure that any questionable data or conduct comes to light."
According to comments from one Nissan dealer who asked to remain anonymous, his regional office did not overtly ask dealers to provide the survey with positive ratings. Rather, it reminded dealers how improved Nissan's performance has been in the past few years and urged dealers to take time to answer the NADA survey to have a chance of increasing the values of their dealerships.
A copy of a June 24 letter that went out to Nissan field personnel in the Northeast region from Gary Frigo, the regional vice president, obtained by Automotive News, told factory personnel that the summer survey results "will truly be a 'report card' for all of us."
"I hope you also feel as embarrassed over our Winter results as I did," the letter said.
"Let's be 100% clear," the letter goes on, "you are responsible for the scores for your current Area & District."
An NADA spokesman said Friday that the summer survey has not been completed.
"When we were informed of the situation in the region we took action and advised Nissan dealers accordingly," said a statement released by NADA Friday. "NADA has since implemented steps to preserve the integrity of the survey."
Are you ready — and qualified — to become the face and voice of your dealership? Marketing expert asks the tough questions.
Auto Dealer Monthly - Feature by Jim Raposa
Broadcast advertising has helped a good many business owners take on an air of celebrity and authority. Former Men’s Warehouse owner George Zimmer’s distinctive voice was the trademark of that company’s TV and radio commercials for nearly 30 years. Sy Sperling launched the Hair Club for Men with a commercial in which he famously told viewers he was not only the company’s president, he was also a client. Zimmer and Sperling leveraged the proper use of on-camera skills to help build their businesses, and they were preceded and followed by countless auto dealers. But the term “proper use” is key, because not every owner is willing or able to represent their own brand.
After a career in radio broadcasting that was followed by ad agency ownership, commercial production and marketing, I have seen the good, the bad and the ugly among dealers who decided to go on the air. In my own market, there is one independent dealer who is clearly trying too hard. He is at least 50 years old, but he shoots commercials in which he talks like a rapper and dances around his lot like it’s the set of a music video. I doubt younger viewers are impressed. This dealer appears to be living out a showbiz fantasy at the risk of blowing media dollars — along with his bottom line.
To be sure, there are many owners and dealer principals I have worked with over the years who decided to take the leap and really nailed it. They understood that no one else was going to convey the passion they had for their business quite the same way they would. John L. Sullivan, owner of a Chevrolet store in the Sacramento, Calif., market comes to mind. He is the type of spokesman who can build trust in the first few seconds of a spot. Another is Bill Cole, who runs the Bill Cole Automalls in Kentucky and in West Virginia, where he also serves as a state senator. He is able to effectively communicate on-camera, and he makes it look easy.
A Star Is Born
Is it time for you to step in front of the camera or behind the microphone? Can you be the face and voice of your dealership? The answer depends on an underlying question that many dealers, ad execs and commercial producers are afraid to ask: Are you really the right person for the job? Talk about the elephant in the room!
For a business owner, there’s a certain level of self-esteem that comes from being recognized as that famous man or woman on TV. And once that vestige of celebrity has been introduced, it can be difficult — if not impossible — to ask the genie to get back in the bottle if it’s not working out. Pity the soul charged with that task.
Before the commercial copy is written and the camera starts to roll, it’s best to take stock of your situation and reverse-engineer your marketing approach. Start by asking yourself and your team what the real goal is, and be specific. If you specialize in safe, secure family transportation, for example, the best spokesperson might be a young parent. Do you look and sound like the clients you wish to attract?
Corey Dissin is vice president and general manager of Propulsion Media Labs in Philadelphia. He connects advertisers with voiceover and on-camera talent and produces radio and TV spots for clients in the U.S. and Canada. “When we consult an ad agency that works with a dealer or directly with a dealer principal, we first want to know if that person is known in the community,” he says. “Are they already a local celebrity? We also want to know if that person’s name is on the signage. Is it John Doe Ford or City Ford? Finally, we want to know if that dealer is glib — are they affable or charismatic?”
Dissin recognizes that not every dealer principal will shine under the lights, despite the fact that they have already succeeded in one challenging field. “I bet if you polled 100 automobile dealer principles, you’d find a high percentage, if not all of them, are excellent salespeople. But that doesn’t always translate to being persuasive on video.”
Caveat Emptor
While the lure of becoming a local celebrity can be enticing, it all comes back to knowing where you want the marketing to take your business. If going on-camera seems like an approach you’d like to take, try shooting a low- or no-cost test video. If you need pointers or ideas, check out some of the countless examples on YouTube. Remember, you might not be perfect your first time out. Be patient. Once you get a take you like, show the video to your agency or someone you trust to give you an informed, honest critique.
“We never want to presume the dealer principal can act when we take on a project,” Dissin says. “We’re always careful to make sure the spot never becomes a farce. We want the client to look good and we want viewers to see the spot and think, ‘What a cool place to buy a car!’ not ‘Oh, God, what a cheesy commercial!’”
Bottom line: If you’re not persuasive on-camera, it’s a waste of your time and ad circulation, and that’s never good. If you must, hire on-camera talent who will deliver the goods — and a healthy ROI — for your dealership. Don Foss, founder of Credit Acceptance and one of the best-known dealers in Detroit, was played by the same actor for years. Foss is a successful businessman with plenty of personality, but he elected to leave the TV work to a professional.
If you have the chops, get started and track the leads coming in the door from your on-camera spots. If not, pick the right person for the job and get back to building your business.
Jim Raposa is president of Raposa Media and has expertise in copywriting and commercial production. JRaposa@AutoDealerMonthly.com
The National Automobile Dealers Association (NADA)’s department of legal and regulatory affairs issued guidance on data protection last week. Officials said the 14-page memo, issued to members on Aug. 28, is part of an ongoing effort to promote compliance by the association, but it comes at a time when industry marketers are turning to transaction data to fuel vehicle sales.
Obtained by F&I and Showroom magazine, the memo acknowledged there are a “number of entities who wish to gain access” to transaction data stored in dealer management systems (DMS), and warned dealers that the “FTC [Federal Trade Commission] may consider any third-party ‘access’ to NPPI (non-public personal information) to be ‘sharing,’” even if the dealer’s vendor never actually accessed the data.
Nine days before it was distributed, the FTC delivered its own warning to big data collectors that it will use all tools at its disposal to protect consumer privacy. The FTC has partnered with the NADA in the past on the topic of data protection, but recent efforts are not related, officials said.
Speaking at the 2013 Aspen Forum on Aug. 19, FTC Chairwoman Edith Ramirez acknowledged the importance of “big data,” even noting that it’s the “FTC’s job to get out of the way of innovation.” But she also said it’s the FTC’s job to make sure consumer privacy is respected.
“Like a vigilant lifeguard, the FTC’s job is not to spoil anyone’s fun but to make sure that no one gets hurt,” she said. “Addressing the privacy challenges of ‘big data’ is first and foremost the responsibility of those collecting and using consumer information. … It is the FTC’s responsibility to make sure that companies live up to their commitments.”
‘Big data’ is a term used to describe the massive amount of information created every day that can be analyzed by firms to deliver targeted marketing, among other things. According to Stamford, Conn.-based Gartner, spending on business-intelligence software is expected to reach $13.8 billion this year. The technology research and advisory firm predicted that spending will reach $17.1 billion by 2016.
In recent months, F&I and Showroom contributor Jim Ziegler has raised concerns about the DMS access some vendors — particularly vehicle information and listing sites — require of dealers, which he believes leaves them vulnerable and their information unprotected. The NADA’s President Peter Welch says he is aware of Ziegler’s crusade, but stressed that “our review of these things has been ongoing.”
“We've had frustrated calls from dealers, ranging from ‘Jeez, various factories are jamming clauses in there, take it or leave it,’ or click through agreements, and there seems to be somewhat of a feeling that they are losing the control of their own intellectual property,” Welch told F&I and Showroom.
The NADA’s memo included a checklist dealers can use to police vendors’ access to their data. It also warned members that they could run afoul of the Gramm-Leach-Bliley (GLB) Act’s Safeguards Rule and Privacy Rule if they provide NPPI to DMS providers, third-party vendors and even manufacturers without taking certain precautions. Such precautions include providing a Privacy Notice to customers and establishing contractual protections.
“This means that unless their Privacy Notices state otherwise, dealers may not provide access to NPPI to anyone, including their manufacturer,” the memo stated.
In June 2012, the FTC took its first action against an auto dealer for GLBA violations, charging Statesboro, Ga.-based Franklin’s Budget Car Sales Inc. with exposing the information of 95,000 customers after an employee downloaded consumer data files onto a flash drive and loaded them onto his home computer, which contained peer-to-peer file-sharing software. The FTC also charged the dealership with violating the FTC Act’s ban on deceptive acts and practices for failing to maintain adequate safeguards as promised in its Privacy Notice.
As part of its settlement with the agency, Franklin’s was required to establish and maintain a comprehensive information security program and undergo data security audits by independent auditors every other year for 20 years.
“The primary issue under these federal regulations generally arises because of a disconnect between the duties dealers have and the promises they may have made to their customers …,” stated the NADA’s memo.
Last month, a senior team from the NADA met with General Motors Co.’s board of directors in Detroit. Among the topics discussed were intellectual property and data security, something Welch said the association will soon discuss with other major players.
“We do have plans in the coming weeks to be meeting with the major DMS providers to have an open and frank discussion with them about what type of tools they offer for dealers to both monitor access and also control and or restrict access,” he said. “We will probably be meeting with auto manufacturers in the coming weeks or months to discuss these issues with them as well.”
Local and federal law enforcement officials announced Wednesday that they had rescued a nursing assistant whose violent abduction in Philadelphia was caught on surveillance video. And as police credit that video for its role in finding Carlesha Freeland-Gaither, 22, and her alleged abductor, Delvin Barnes, another sort of surveillance technology also helped lead officials to the suspect and the victim: a GPS device, planted in Barnes’s car by the dealership that sold him the vehicle.
Barnes, 37, was arrested in Maryland on Wednesday, three days after Freeland-Gaither was abducted on a Philadelphia street. Freeland-Gaither was with Barnes at the time of his capture in Jessup and was in reasonably good condition, authorities said at a news conference.
Officials began to zero in on their location after the victim’s credit card was used near the Maryland-Delaware border.
But a major break in the case came from law enforcement in Virginia, where police already were investigating Barnes in a different case. The images of the suspect in the Philadelphia abduction indicated that it might be him.
Barnes has a long criminal history and was wanted in Virginia as a suspect in an abduction there.
Investigators began tracking the movements of his car — a gray Ford Taurus — through the GPS device. The dealership installed it because of Barnes’s poor credit at the time of purchase.
Two detectives working together in neighboring Virginia counties guessed that the car might have such a device after they “noticed a Virginia inspection sticker on the front windshield and a decal from a car dealership in the Richmond area,”as The Post reported Thursday night. The detectives were aware that the dealership placed GPS devices in some of the vehicles it sold.
Capt. Jayson Crawley of the Charles City County Sheriff’s Office and Sheriff’s Lt. J.J. McLaughlin III of the New Kent County Sheriff’s Office asked the dealership to activate the device on Wednesday, they told The Post.
The dealership complied, and Barnes’s car was located that day in Jessup.
Over the past few years, car dealerships — especially those catering to lower-income customers and those with poor credit — have placed GPS devices in the cars they sell, sometimes without the knowledge of the buyer. The practice is controversial.
The devices are generally “designed to help the repo man find your car if you stop paying,” the Tampa Bay Times reported in 2013. The devices stay on the car until the loan is paid off.
“They don’t want the customer to know that if they don’t pay, they can come find it,” Duane Overholt, a consumer advocate who runs the Web site StopAutoFraud.com, told the Times.
In the case of one Florida dealership, customers whose cars were equipped with tracking devices were invited in for a “safety check” after they finished paying, at which time the device was covertly removed, the Times reported.
It’s not clear whether Barnes knew about the device in his car.
By: Auto Dealer Monthly
Feature by Brian Reed
Billing errors for dealership management systems are more common than you may think. Technology expert suggests you check your monthly invoice for erroneous charges related to hardware and software, annual increases and click fees.
You know the approximate amount of your dealership’s monthly electric bill, but do you know what you pay per kilowatt-hour? Many dealers manage the monthly invoice for their dealership management system (DMS) much like their electric bill. They know the total amount they pay but not the detail behind it.Auto Dealer Monthly - Feature by Brian Reed
I’m aware of an internal study by one DMS provider which found that as many as 40% of the invoices sent to dealers who had their system for at least one year were incorrect. In some cases, they paid back thousands of dollars in overcharges.Auto Dealer Monthly - Feature by Brian Reed
So is there a conspiracy among the DMS providers to overcharge their dealers? Absolutely not. But it is possible for a provider to make mistakes. More often than not, those mistakes are the result of changes at the dealership that are not reflected in the monthly invoice. Let’s review three key areas that can result in overcharges on your monthly DMS bill:Auto Dealer Monthly - Feature by Brian Reed
1. Hardware and Software: Many dealers sign up for the DMS provider’s software and applications and later replace them with software from a third party. In many cases, when a dealership stops using an application or software feature of the DMS, the monthly billing for the built-in software can and should stop.Auto Dealer Monthly - Feature by Brian Reed
The same goes for hardware. You could be paying monthly fees and maintenance charges to your provider for hardware you have (a) replaced with hardware from a third party or (b) upgraded via your DMS provider. Incredible as it may seem, many dealers who have updated hardware find they are still paying for the old gear. Again, there is no conspiracy at work; it’s simply a matter of failing to update your agreement.Auto Dealer Monthly - Feature by Brian Reed
2. Annual Increases: Many DMS contracts include a built-in annual increase, often in the neighborhood of 4%. This increase varies based on the upfront negotiations. Check to be sure the actual annual DMS price increase matches the contract.Auto Dealer Monthly - Feature by Brian Reed
3. Click Fees: Some DMS providers charge “click fees” for the paper and toner they use. Always audit actual usage versus what is invoiced. Don’t assume the total clicks you are being charged for are correct.Auto Dealer Monthly - Feature by Brian Reed
This is not a one-time process. Dealers should manage their monthly DMS invoices as prudently as they manage any other expense. Each line item of each invoice should be audited on a monthly basis, and don’t be afraid to ask for help from your provider. Recently, a dealer friend of mine sat down with a representative from his provider. Working together, they found several items that had been on his invoice for two years that the representative simply could not explain.Auto Dealer Monthly - Feature by Brian Reed
Many dealers who do monthly audits can attest to the financial benefit. Dealership-savvy accountants are an excellent resource. There are also a number of consultants who specialize in reviewing invoices for dealers on a monthly basis. Some are so confident in their skills that they only get paid when they save the dealer money. These companies and consultants can also perform a pricing benchmark study for you to compare what you are paying for your DMS versus a large sampling of dealers who are similar in size.Auto Dealer Monthly - Feature by Brian Reed
Finally, this is one issue you should feel free to bring up in your 20 Group. Some groups discuss this very topic on a regular basis. Why not start the conversation yourself? Once you have completed your review, ask your fellow dealers to do the same. You could be responsible for starting a new best practice.Auto Dealer Monthly - Feature by Brian Reed
The bottom line is that every dealer should be proactive in reviewing their monthly invoices from their DMS provider. The same is true whether they do it themselves or retain outside expertise. Unlike your electric bill, every line is crucial.Auto Dealer Monthly - Feature by Brian Reed
It’s insane! Chrysler will soon begin production on 700-horsepower editions of the Dodge Charger and Challenger, both due in the 2015-MY. Considering my 1968 Dodge Super Bee was rated at 335 hp and was one of the fastest production cars of the day, I have to ask, where’s it all going?
Trumping the 650-hp 2015 Corvette Z06 and the 662-hp Mustang Shelby GT500 — and a host of European exotics — Chrysler’s SRT Hellcat line should be the ultimate “Need for Speed” machine, assuming buyers can find a public highway suitably equipped and unguarded to exercise its capability.
Well, hang on, speed freaks. In Monterey, Calif., Brandon Boeckmann is preparing to put his private-label, 1,058 hp Galpin GTR1 supercar in production. He and his team have been showing off the prototype at car shows. Prices will begin at a cool $1 million. I wonder if that includes floor mats.
Boeckmann is the grandson of a friend, Bert Boeckmann of the Galpin dynasty in the San Fernando Valley. The group includes the nation’s No. 1 Ford dealership and a myriad of other super-performing franchises. They stated they only intend to sell six units the first year. I am trying to picture a group of salesmen out in front of the GTR1 showroom, smoking cigarettes and waiting for an up. Will they put an inflatable gorilla on the roof? Only time will tell.
By: Automotive News
AutoDealer Monthly
I have been to Atlantic City many times. I have conducted seminars there, spoken at conferences and consulted nearby dealers. It isn’t the nicest part of New Jersey, and it sure ain’t Las Vegas. Unlike Vegas, where the airport is a stone’s throw from the Strip, the closest major airport is in Philadelphia. The streets and sidewalks around the casinos are nice enough, but you wouldn’t want to stray too far from the bright lights. The surrounding blocks are seedy, dirty and crime-ridden. It’s the kind of place that makes you feel like taking a long, hot shower after each visit.
The Borgata and the Revel were the only hotel-casinos where the Alpha Dawg would rest his head, and the Revel closed its doors over the summer. So did the Trump Plaza and the Showboat, and half of A.C.’s big gaming venues could be shuttered this time next year.
As anyone who has visited Atlantic City knows, with a few notable exceptions, customer service is notoriously poor. They don’t care and it shows. Aside from generating tax dollars, the casino owners appear to have done little to reinvest in their city. They allowed their properties to deteriorate and their neighborhoods to decline.
When Indian casinos started popping up all over the Northeast, gamblers left Atlantic City in droves. Now it’s on its way to becoming America’s largest ghost town.
Dealers, take heed. This applies to you. Competition is increasing, and some of you don’t seem to be paying attention.
I have visited thousands of dealerships over the previous 28 years. Frankly, I am ashamed to set foot in some stores. Even with all the latest factory-mandated renovations, some of your showrooms look like pig pens. Yes, I am a dealer advocate, but some dealerships are a disgrace to the rest of us.
Don’t get me wrong. I despise the manufacturer programs that make every dealer adhere to identical, cookie-cutter models. Those factory stiffs who think uniformity sells cars and trucks are idiots. No manufacturer should dictate the sights and smells that greet your customers. It should be up to the dealer. But many of your dealerships need a serious housecleaning, and some much more than that.
Clean up your showrooms and properties. Take a serious look at your conference and training rooms. Repave your lots and fix the lighting.
How many outdated materials are thrown in corners and stacked against the wall? Display and take pride in your inventory. Make your staff dress and look presentable. Some of your older employees look like bums. Some of your younger ones are displaying too many piercings and too much body art. And they’re all constantly texting. Enough!
This is a people business. Put that damn phone down and pay attention. True professionals come to work well-groomed and dressed for success with a winning attitude.
SCHAUMBURG, Ill. — Experian Automotive found that the longer consumers owns their vehicles, the less likely they are to buy their next vehicle from the same brand. Average length of ownership in the first quarter of 2014 was 7.75 years, a number which correlated with a brand loyalty rate of 49.5%.
In Experian’s analysis, the company found that owning a car for one year held a brand loyalty rate of 57.3%, while owning it for 12 years had a brand loyalty rate of 33.8%. While the drop in brand loyalty was consistent with ownership length, the largest change came after 3 years of ownership. That's when brand loyalty dropped off by 10 percentage points.
“Leases with their fixed length ownership cycle are typically strong contributors to brand loyalty,” said Brad Smith, director of automotive market statistics for Experian Automotive. “Over the course of seven years of ownership, a lot of things change, including vehicle product offerings, vehicle budget and credit score.”
He also added that the more time a customer had between dealer interactions, whether for service or sales, the higher the probability they would leave the brand.
Experian found that Ford and Subaru had the highest brand loyalty at 61% and 59.4%, respectively, but Ford had a much higher average length of ownership at 110 months. Dodge and Buick shared the longest average ownership length however; both companies had poor loyalty rates at 22.6% and 38.4%.
“Understanding how long consumers hang onto vehicles, or how often then return to market and purchase the same brand, are critical pieces of information for automotive dealers, retailers and manufacturers,” said Smith.
Rising transaction prices for new vehicles have been a big contributor to the health of the auto industry this year, J.D. Power analysts reported this week. They noted that the average new-vehicle transaction price has risen $3,900 since 2009 to $29,600.
Current transaction prices for new vehicle and the rise in sales could push up the value of vehicles purchased to the highest level ever at $407 billion, J.D. Power noted.
“When defining success in the auto industry, whether it is for a specific segment, manufacturer or model, it’s important to look beyond basic sales figures,” said Thomas King, vice president of J.D. Power’s Power Information Network.
King noted that not all vehicle segments have performed equally, with some delivering stronger volumes and lower price growth while others realized greater price growth but weaker sales. Retail sales in the large pickup segment, King pointed out, have increased 4.6% this year, which is below the overall industry sales increase of 5.7%. However, the average price of a pickup has risen by $2,700 over that same period, a gain of 7.5% compared to the industry average of 2.3%.
“From a sales perspective, large pickups have grown slightly slower than the industry overall, but from a price perspective, they have significantly outperformed the industry,” said King.
By contrast, compact SUVs have demonstrated exception retail volume growth of 22.1% so far this year. The average transaction price for models in this segment, however, have changed only slightly by an average of 0.6%. It is these statistical differences that is driving J.D. Power's belief that sales numbers alone do not provide the best overall picture of industry success.
“With the rapid growth of average transaction prices over the past few years, success needs to be defined more broadly to include overall revenues in addition to sales volumes,” said King.
ANTON, Mass. — LoJack Corporation has deployed its LoJack inventory management system with South Florida's Braman Motorcars, a top 30 dealer group. The new inventory management system will help deliver an accurate location of vehicle inventory across multiple lots, helping to minimize the time required in the regular dealer inventory process.
LoJack is working with Braman to further refine the system that uses a telematics platform and a proprietary user interface.
"LoJack has had a long tradition of bringing products to dealerships that help boost their bottom-line profits," said Hal Dewsnap, senior vice president and general manager of U.S. sales at LoJack. "Braman Motorcars is one of the South's most respected and successful dealerships, and we're proud to help improve their inventory process and help build their business through an inventory management system. Many dealers have asked LoJack to help them obtain a better solution for lot management for their vehicle inventory —we listened, and we think we have delivered."
The inventory management system helps sales personnel at dealerships locate vehicles across the various lots that larger dealers sometimes cope with to handle their inventory of vehicles. The system also warns dealers of low battery voltage on vehicles, allowing them to expedite the work of keeping batteries charged; dealers only need to work on those vehicles that need charging, and can skip the time-wasting work of checking the battery levels on already-charged vehicles, officials said.
With the LoJack inventory management system, dealers no longer have to worry about bringing a customer to a vehicle for a test drive, only to discover that the vehicle has a dead battery. Additionally, the inventory management system can help avoid battery-related customer delays when they arrive to pick up the car, avoiding potentially damaging Customer Satisfaction Index (CSI) scores.
The LoJack inventory management system is available on the computer and for mobile workers. Employees will be able to see the location of their vehicle directly on their smartphone or tablet computer, obtain additional information about each vehicle quickly, track test drives and get an early warning movement alert through geo-fencing.
"At Braman Motorcars, we constantly evaluate our work processes to deliver the highest possible level of customer service," said Evan Bernstein, senior controller at Braman Motorcars. "The Inventory Management System from LoJack can help us reduce cost, while streamlining the process to deliver on that customer service excellence promise."
Kp>In addition to using the inventory management system, Braman loads the LoJack Stolen Vehicle Recovery System at their West Palm Beach Auto campus, which includes BMW, Mini, Audi, Bentley, Rolls-Royce and Porsche brands.
