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Car Market Shifting As More Work, Shop From Home For those dealers not in the premium luxury end of the market, wouldn’t it make sense to investigate the marketing, technologies and new ways of securing business in the subprime, deep subprime and first-time buyer side of the business?
What unexpected turns 2020 had for automotive retailers.
We went from business as usual in the first few months to a truly desperate time during the early days of the pandemic with lockdowns, stay-at-home rules and lack of production.
Then, to boom times in the third and fourth quarters, where the combination of vehicle production gaps that created shortages and higher gross margins for both new and used vehicles, the migration away from public transportation and ride- or car-sharing-stimulated private car ownership, and more cash in a lot of folks’ pockets (due to forced savings by not going out), created a perfect positive storm for most dealers’ bottom lines.
Chamber’s economic forecast sees brighter days ahead, if COVID-19 is contained
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BIRMINGHAM It was a year ago that Paul Traub, a senior business economist with the Federal Reserve Bank of Chicago/Detroit, stood before members of the Birmingham Bloomfield Chamber of Commerce with an ominous projection: 2020 could bring about an economic recession.
Traub wasn’t reading tea leaves, but rather a yield curve inversion that showed long-term bonds had lower earnings than short-term bonds. He said 9 out of 10 times, that inversion is an indicator of a coming recession but only if an external shock occurs to trigger a crisis.
It is an oasis of opulence at Interstate 95 and Butler Boulevard, its landscaped driveways and second-floor balcony bedecked with brand-new $200,000 Bentleys and $100,000 Maseratis.
But with new-car sales down this year as the COVID-19 pandemic continues, how is Mario Murgado’s 40,987-square-foot dealership at 7137 Bonneval Road doing after opening in the middle of it all?
Jacksonville’s purveyor of prestige at the highest-end said they have done very well so far, averaging about four new Bentleys a month since opening June 18, with others on order. Murgado expects that trend to continue as he sells many more new Bentleys, Alfa Romeos and Maseratis as well as a plethora of pre-owned high-end Rolls-Royces, Ferraris, Jaguars and other premium product parked on his sales floors.
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Salesman Cheyen Shilletto (right) hands Chevy Camaro keys to customer Julio Larrea at East Hills Chevrolet in Freeport, NY, in June.
Lessons Learned in Auto Retailing During COVID-19 The pandemic has spurred a number of changes in sales, service, inventory management and the overall customer experience. Along the way, dealers struggled initially to be profitable.
Good habits are formed in bad times, and looking back, the dealer business upside to this year’s tragic COVID-19 pandemic should be a lot of good habits, born out of necessity.
Here are some examples, according to numerous phone interviews, industry conference calls and webinars throughout 2020: