Stories from the Sales Frontlines

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Comments

  • joel0622joel0622 Member Posts: 3,299
    Does anybody think that Ford will try something similar? My thinking is that when the dust settles from all of this, Ford will be at a bit of a disadvantage, since they will still have a bloated dealer network in comparison

    We already did over the past several years long before the goverment got involved. Thats one of the reasons why they were not on the Hill with there hand out when all the smoke cleared
  • madmanmoomadmanmoo Member Posts: 2,039
    Tip of the hat to Ford for doing that. You have been saying it all along.

    There are about 216 Porsche dealerships in the U.S. I have only heard of one going under and another going bankrupt. Champion Porsche in Florida is going to be going through some restructuring. I think the owner may have financed one too many racing teams on the company ledger. Otherwards, the dealerships seem to be doing well.

    I don't know about anyone else, but I have seen a huge uptick in business in the last 3 weeks. Very happy to see this happening.
  • jipsterjipster Member Posts: 6,299
    but I got the 4th one free

    Free is good! I think I got around your price with a $80 rebate a couple years ago.

    They're suppose to get between 50k and 60k

    That's probably what they'll get. But, I believe they are rated 80k miles.

    It's going to pour buckets

    Oh, you'll love the traction in rain. I don't drive any faster in rain, but I have much more confidence I'm not going to hydroplane or lose traction with the Tripletreds.
    They grip like a homicidal gorilla. :)
    2021 Honda Passport EX-L, 2020 Honda Accord EX-L, 2011 Hyundai Veracruz, 2010 Mercury Milan Premiere.
  • tidestertidester Member Posts: 10,059
    With GM shutting down 1,100 dealerships I am wondering just exactly how much of a drain a dealership is to the company, i.e., how much does a dealership cost GM?

    For example, if a dealership is selling a lot of cars, then the dealership has to be a net plus to the company. If a dealership is selling no cars, what sustains the dealership? Wouldn't they just go away on their own accord?

    tidester, host
    SUVs and Smart Shopper
  • jipsterjipster Member Posts: 6,299
    don't know about anyone else, but I have seen a huge uptick in business in the last 3 weeks. Very happy to see this happening.

    Must be stock owners of the big oil companies buying your cars. They've found another way to screw us at the pump despite decreased demand. For the sake of the country moo... you must decline their money!

    Speaking of Honda, I just noticed what I believe to be the new Accord. Not sure as I usually don't follow the low end brands. :P What's up with that big crease down the sides, running from the front quarter panel back to the gas cap cover? Plus, they've got the door handles upside down. Most unHonda like design. Would be a nice looking car without that big drag reducing crease.
    2021 Honda Passport EX-L, 2020 Honda Accord EX-L, 2011 Hyundai Veracruz, 2010 Mercury Milan Premiere.
  • boomchekboomchek Member Posts: 5,516
    I agree with you, that's why we already decided that wife will stay at home, and I will bring home the bacon.

    As for getting a home sitter, I would just feel akward having strangers hang out in my home for most of the day, so that's not likely to happen.

    I have hard time trusting a stranger with my car let alone something as precious as my own child.

    To stay on topic:

    Sold a couple rides early this week. One canceled due to financing. The lady tried to get out of her current loan and into a new car for the second time in a year, and we still can't get it done because she keeps taking on other debt :sick:

    And another deal we did that was a locate. Vehicle was showing that it was available when it really wasn't. There's not another one like it. We can't get another one, customer is ticked off, and I feel bad about it. :(

    Funny thing about car business. Every month is a fresh start. You can be a top guy one month and run into trouble deals all of next month.

    Or you can go from zero to hero in a week, even during the least week of the month you have a chance tyo outsell everyone.

    2016 Audi A7 3.0T S Line, 2021 Subaru WRX

  • driver100driver100 Member Posts: 32,638
    With GM shutting down 1,100 dealerships I am wondering just exactly how much of a drain a dealership is to the company, i.e., how much does a dealership cost GM?

    That's a good question Tidester. Why is it better for GM to have fewer dealers? How does that improve the bottom line? It might permit the individual dealers to sell more, but it won't lead to more sales for GM - maybe even less. In the article I posted earlier in the day it only said fewer dealers means more business for each individual dealer left, so, they will provide better service and nicer showrooms, which should result in happier customers. Seems like a small advantage, for such a drastic step, and that has to be a very minor way to try to sell more cars. :confuse:

    In brief, sure they have 1/3 more dealers than they need, but how does that drain money away from GM?

    2017 MB E400 , 2015 MB GLK350, 2014 MB C250

  • jipsterjipster Member Posts: 6,299
    Why is it better for GM to have fewer dealers?

    Better to have 3,000 strong financially sound dealerships, than 4,500 struggling dealerships that can't pay it's bills.

    We had 5 Chrysler dealerships put on the closing list in our area. One owner stated he will appeal the decision. Another owner, with 300 cars on his lot, said new cars only get 50 cents on the dollar at auction. Which sounds nuts to me. A new Chrysler that goes for $20,000 could be sold for only $10,000 at auction???
    Wonder if these guys being shut down would offer that $20,000 car to the public for around$14,000. Would you buy Chrysler then?
    2021 Honda Passport EX-L, 2020 Honda Accord EX-L, 2011 Hyundai Veracruz, 2010 Mercury Milan Premiere.
  • fezofezo Member Posts: 10,386
    I'm sure the thought is that Toyota sells as many vehicles with 1/3 the number of dealerships. That makes for a lower cost to Toyota to maintain a dealership network. The big boys in Detroit are just figuring this out.

    Dealerships do have a cost. The manufacturer kicks all sorts of money into them.
    2015 Mazda 6 Grand Touring, 2014 Mazda 3 Sport Hatchback, 1999 Mazda Miata 2004 Toyota Camry LE, 1999.
  • houdini1houdini1 Member Posts: 8,356
    For example, if a dealership is selling a lot of cars, then the dealership has to be a net plus to the company.

    Well, if GM loses money on every car they sell then they should get rid of the dealers that sell the most cars, right? They won't actually make any money but they will lose less. :confuse:

    2013 LX 570 2016 LS 460

  • driver100driver100 Member Posts: 32,638
    Dealerships do have a cost. The manufacturer kicks all sorts of money into them.

    Toyota and Honda might sell way more cars per dealer, but how will cutting dealers really help GMs bottom line. I am sure GM has some coop advertising, but what other costs. Sure it will make the dealer network stronger if there are fewer dealers, but wouldn't the weak ones just go under on their own anyway.

    In almost every business 20% of your top performers will do 80% of the business. But what will be the actual savings by having 1/3 fewer dealers?

    2017 MB E400 , 2015 MB GLK350, 2014 MB C250

  • driver100driver100 Member Posts: 32,638
    Well, if GM loses money on every car they sell then they should get rid of the dealers that sell the most cars, right?

    I like that theory...they should have made you head honcho instead of Fritz. ;)

    2017 MB E400 , 2015 MB GLK350, 2014 MB C250

  • isellhondasisellhondas Member Posts: 20,342
    With fewer stores the customers won't be able to pit dealer against dealer as much and the dealers won't have to take as many nothing deals.

    They might even be able make a decent (gasp) profit on the cars they sell.
  • isellhondasisellhondas Member Posts: 20,342
    So you got the first one "free"?

    That reminds me of a time long ago when I managed a large Sears Auto Center.

    If we advertised a certain line of tires at 25% off we usually did O.K but not as well as when we would advertise..." BUY THREE, GET THE 4TH ONE FREE" !
  • mikefm58mikefm58 Member Posts: 2,882
    With fewer stores the customers won't be able to pit dealer against dealer as much and the dealers won't have to take as many nothing deals.

    I'm sure we're all here aware of that, but that doesn't answer the question. How does closing dealers affect the financial health of the auto manufacturer? Granted, there has to be some minimal cost, but not sure how to quantify that.
  • explorerx4explorerx4 Member Posts: 20,963
    don't forget, my explorer has lived a very different life from yours.
    it has had 2 novice drivers for the last 3+ years.
    i only drove it on vacations or if we had to fill it up with some cargo, or drive a group somewhere.
    as far as the transmission goes, the possible symptom was after running fully loaded on the highway for a few hours, when you got into some stop and go, it flared somewhat going from 1 to 2 (rpms went higher than usual before shifting).
    the suspension issue is easier. after filling up the gas tank, the rear took a noticable german shepard stance (rear lower than the front). when empty, the rear was noticeably higher than the front when viewed from the side.
    i don't think you have anything to worry about.
    my little egghead, so far has duke, georgetown, and uva as her top 3 schools,
    so if you are looking to sell your explorer in fall 2010, i might be interested.
    2024 Ford F-150 STX, 2023 Ford Explorer ST, 91 Mustang GT vert
  • fezofezo Member Posts: 10,386
    I don't know. A guy at our church makes an awfully good living selling at a Buick-Pontiac-GMC dealership here in town. When I get a chance to hang out where he's there chatting he's always got gadgets and stories of amazing trips and such all on GM's nickle for making this or that target. That's not the dealership paying - it's GM. I have to think they have stuff going on at all the dealerships and the costs have to add up.
    2015 Mazda 6 Grand Touring, 2014 Mazda 3 Sport Hatchback, 1999 Mazda Miata 2004 Toyota Camry LE, 1999.
  • lrguy44lrguy44 Member Posts: 2,197
    Basically, it leads to healthier dealers. Manufacturers demand certain improvements in the physical plant. Dealers need to invest in special tools and computers (many times stuff the indys can't get). One of the criteria was CSI - poor CSI drives customers to other dealers. Support staff - factory reps and admin personnel that support the dealers can be cut.
    Fewer dealers make for a more profitable and healthier environment for both sides.
  • lrguy44lrguy44 Member Posts: 2,197
    Many of the trip rewards, etc have disappeared. LR always gave a Carribean Masters Cruise to top performers (my wife loved the 7 days of sun) Those are gone. The lavish new car training is going to be cut back.
    Times have changed. But fewer dealers again will be healthier and will take less support.
  • isellhondasisellhondas Member Posts: 20,342
    Yes, good answer.

    When stores are pressured to take every skinny deal and make little profit, the whole operation sufers. The customers may not be treated as well which leads to poor CSI and unhappiness with the brand.

    They will also be able to attract better salespeople if they can afford to pay them well.
  • fezofezo Member Posts: 10,386
    Thanks, lr. You answered my question beofre I asked it. I was assuming all the trips and neat bling were victims of the times.

    Glad you got your cruise in during the good times.

    I've yet to go on a cruise. I really need that...
    2015 Mazda 6 Grand Touring, 2014 Mazda 3 Sport Hatchback, 1999 Mazda Miata 2004 Toyota Camry LE, 1999.
  • joel0622joel0622 Member Posts: 3,299
    It really sucks that all the perks are gone and the along with the commision checks. The perks i.e, playing golf, going to Titans/Predators games, Casino Night, Trips, etc and the money we made is what made it worthwhile working these horrendous hours and putting up with obnoxious consumers.

    I
  • isellhondasisellhondas Member Posts: 20,342
    Now all of those dollars that were so well spent are being used to survive.
  • joel0622joel0622 Member Posts: 3,299
    The dollars spent in the past on rewarding supportive/succesfull dealers is not what put the industry in the situation it is. All of our perks went away several years ago so we are used to it now, it is the commisiion check or lack there of over the last year I am having problems getting used to. LOL
  • explorerx4explorerx4 Member Posts: 20,963
    my friend up the street 'made me' drive his new carrera 's' last weekend.
    it only had 50 miles on it!
    it was still within the 1500 mile break in period, so i had to keep my eye on the tach.
    i feel really fortunate to have someone as a friend who has let me drive 4 of the porsches he has owned. :)
    2024 Ford F-150 STX, 2023 Ford Explorer ST, 91 Mustang GT vert
  • explorerx4explorerx4 Member Posts: 20,963
    where i work we have had dozens of people being beat on by a single big client for the last couple of years. since they are losing money they are trying to pin it on us as a vendor. we know we are doing a good job, but they still hold the hammer.
    2024 Ford F-150 STX, 2023 Ford Explorer ST, 91 Mustang GT vert
  • lrguy44lrguy44 Member Posts: 2,197
    It is like thinning a herd of elk - the weak are weeded out and the smaller herd becomes stronger
  • oldfarmer50oldfarmer50 Member Posts: 24,412
    "...The Fin..."

    My aunt had a 59' "Fin". I remember being blown away by that "asian" looking back end.

    She sold it in the late 60's to a bunch of 15 year-olds who, since they had no licenses, turned it into a "doodlebug" and drove it around in the fields. For some reason they thought it would be cool to remove the hood and the windshield. Since the car had a leaky radiator, a drive in that beast would include being sprayed with hot antifreeze. Of course, when you're 15, that was a positive thing.

    As I recall, these junior Indy racers eventually rolled the car down an embankment and there it sat rusting in a stream for many years.

    2019 Kia Soul+, 2015 Mustang GT, 2013 Ford F-150, 2000 Chrysler Sebring convertible

  • oldfarmer50oldfarmer50 Member Posts: 24,412
    "...Daycare costs so much...she might as well stay home and raise the baby..."

    Not to mention how nice it will be when the kid doesn't become a serial killer because "mommy wasn't there for me". ;)

    2019 Kia Soul+, 2015 Mustang GT, 2013 Ford F-150, 2000 Chrysler Sebring convertible

  • driver100driver100 Member Posts: 32,638
    Fewer dealers make for a more profitable and healthier environment for both sides.

    This answer was one of the better ones as to how cutting dealers could make GM stronger. I suppose fewer dealers means higher prices, - less competition amongst dealers for fewer customers, but it won't make the cars better, and that is what really has to happen.

    I heard one expert yesterday who said the Volt will take another 4 or 5 years to make it to the road, they are way to optimistic in forecasting it will be ready in a year or so.

    Another big problem is the government is getting involved in car making. They will insist on green cars and Volts. If the price of gas is fairly reasonable the main thing consumers want from the D3 is trucks and SAVs. Government tries to make them drop that....it can only get worse.

    I wonder if GM will lose sales overall when they lose these dealers. Many are in small towns or rural areas where people support their local dealership....they buy because there is a dealer there. What does it matter to GM if he only sells 50 cars a year?

    2017 MB E400 , 2015 MB GLK350, 2014 MB C250

  • dino001dino001 Member Posts: 6,191
    Maybe they did somewhere, but here in Tampa a big megastore was opened just as the housing bust started - of course on top of several other megastores and over twenty small stores when counting within 50 miles (The search literally returned 24 stores at distance less than 50 miles from my zip code). That still doesn't count Orlando. So, no Joel - there was no visible effort on Ford part to let go some dealers, at least not in my area anyway.

    When I think about it, the only real chance for Ford is GM's turning into United Airlines (which is a strong possibility) - a company run by unions, where customer is always wrong. If both Chrysler and GM actually succeed in their restructuring, Ford may be in big (and I mean BIG) trouble.

    2018 430i Gran Coupe

  • houdini1houdini1 Member Posts: 8,356
    I wonder if GM will lose sales overall when they lose these dealers. Many are in small towns or rural areas where people support their local dealership....they buy because there is a dealer there. What does it matter to GM if he only sells 50 cars a year?

    How dare you question the decision making ability of GM executives ! Of all the nerve ! ;)

    This sort of reminds me of the guy down in Texas who traveled around to all the farmers buying watermelons. He bought them for $1. each and when he had a full load of 100 he would go to the local market and sell them for 50 cents each.

    He kept losing money so he asked the experts at Texas A&M for suggestions on what to do. They told him to get a bigger truck. The GM deal is sort of the opposite. They're getting a smaller truck.

    2013 LX 570 2016 LS 460

  • fezofezo Member Posts: 10,386
    On the government getting involved in car making - there were two choices: do that or let GM and Chrysler die. Now I probably would have let them die myself but if we were going to rescue them the government has to be involved. I have absolutely no interest in the idea of just tossing tens of billions at them and saying "well, you guys know what you're doing."

    I still don't know that they can survive even under these circumstances.
    2015 Mazda 6 Grand Touring, 2014 Mazda 3 Sport Hatchback, 1999 Mazda Miata 2004 Toyota Camry LE, 1999.
  • houdini1houdini1 Member Posts: 8,356
    The fact that no one seems to grasp is that GM sells more vehicles than anyone else, so selling cars or building cars that people want is not the problem.

    Essentially they have become almost a microcosm of our government....not having their priorities in order, poorly managed, wasteful, and with entrenched interests that would literally die before they would change.

    2013 LX 570 2016 LS 460

  • graphicguygraphicguy Member Posts: 14,196
    isell....I kind of view the Chrysler debacle a little differently. I don't think there was enough demand for their vehicles to begin with to support all the dealers they had. I guess you could say that the margins will go up with fewer dealers. But, if no one is coming into the store to look at your wares to begin with, it doesn't matter whether you have 1 store, or a 1,000 stores selling them.

    If people aren't buying at the steeply discounted prices, they certainly aren't going to buy if margins/prices go up.
    2024 Kia EV6 GT-Line AWD Long Range
  • joel0622joel0622 Member Posts: 3,299
    So, no Joel - there was no visible effort on Ford part to let go some dealers, at least not in my area anyway.

    I can't tell you the time line but right now there are 3800 Ford Dealers in the US. It wasn't 5 years ago or so there were 5100.

    I don't see how we could be in big trouble if they restructure. We have been doing for the last 5 years what they are trying to do now. The big difference is that we did not need the Goverment holding our hand. The only thing Ford has to worry about is that when GM becomes Govement Motors that they keep the playing field level.
  • driver100driver100 Member Posts: 32,638
    RE FORD We have been doing for the last 5 years what they are trying to do now.

    Ford deserves a lot of credit for downsizing earlier, and for not needing government help. Although, if this goes on much longer even they admit Ford won't make it for another year if things don't change. But, lets not give too much credit either.....Ford had the worst cars (always making bigger heavier gas guzzlers at the wrong time) and the worst management and made very bad decisions for many years, so all they did was try to improve their lineup, cut costs, get more efficient, and basically downsized before the big crunch.........in other words they were fortunate, I think more lucky than smart!

    2017 MB E400 , 2015 MB GLK350, 2014 MB C250

  • joel0622joel0622 Member Posts: 3,299
    The Way Forward plan is working. Our market share increases every month the losses continue to decrease, and are line up is second to no one in the industry.. We will be profitable by 2011 just like the plan calls for.

    A day does not go by that at least two or three people tell me they are here because of what we have done, both life long import and GM buyers. I see it every day.
  • fezofezo Member Posts: 10,386
    I think Ford got smart at exactly the right time. Smartest thing Bill Ford ever did was fire himself as CEO. I like him - he has the old motor oil in the veins and a good vision of where he'd like the company to go but was not ready to take on the necessary restructuring that was necessary so he found and hired a guy who could.

    Ford started turning the lineup around just as they hocked everything specifically to avoid what GM and Chrysler, who were not smart enough to read the writing on the wall, are now doing.

    I'm rooting for Ford big time. After my Windstall experience I had written them off my consider list forever. I'm changing my mind. That doesn't mean I'll buy one but they are back on the list of things to check out.
    2015 Mazda 6 Grand Touring, 2014 Mazda 3 Sport Hatchback, 1999 Mazda Miata 2004 Toyota Camry LE, 1999.
  • fezofezo Member Posts: 10,386
    Oh, and I see locally that Ford is indeed consolidating dealerships around here. now in town we already had Ford-Lincoln-Mercury in one dealership. They've now combined the separate dealerships that are 20 miles up the road into one. There had been a LM dealer who also had Mazda. He's gone and the LM franchise went to teh Ford dealer. The Mazda franchise is now part of the locall Chevy dealership.
    2015 Mazda 6 Grand Touring, 2014 Mazda 3 Sport Hatchback, 1999 Mazda Miata 2004 Toyota Camry LE, 1999.
  • dino001dino001 Member Posts: 6,191
    I'm glad to hear that at least the efforts are honest and legitimate. The product has improved dramatically in terms of both design and quality (not totally across the board, but in many important segments), the dealer reductions seems to be a fact - I honestly didn't know that the reduction was so dramatic (1300 dealers is already more than GM's 1100 - and Ford is a smaller company!). Wonder how many of those were separations and how many were closings based on the local markets (some dealers are closing because they go bust, not because anyone has told them). I must admit from my neck of the woods it didn't look as there was a change in the network. I think generally, US has too many retailers of just about anything - but that's another story.

    One thing has to go for sure - it's Mercury line. No unique car, just additional expenses on marketing, styling and production with pretty much no benefit. Mercury is probably worse than Pontiac. Make Lincoln brand stronger, with one more lower-end entry, preferably based on Euro Ford Mondeo and much, much better higher end cars (so far they are mediocre at best) and cut Mercury.

    2018 430i Gran Coupe

  • snakeweaselsnakeweasel Member Posts: 19,593
    One thing has to go for sure - it's Mercury line. No unique car, just additional expenses on marketing, styling and production with pretty much no benefit.

    As it now stands I would agree with you. But I would like to see Ford take Mercury in a new direction. Something in the line of entry level sport sedans and coups. Something that could go against C class and 3 series cars.

    2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D

  • fezofezo Member Posts: 10,386
    I wonder how much it costs Ford now to have Mercury around? The vehicles themselves are just fords with enough odd parts to make them look a little different but that has some expense and they have the additional dealers to supply.

    I wonder if LM dealers could survive just on Lincoln. my guess would be no.

    I like your idea of Mercury that would go against the C class and 300 series but can't imagine Ford has the money to put into that at this point.
    2015 Mazda 6 Grand Touring, 2014 Mazda 3 Sport Hatchback, 1999 Mazda Miata 2004 Toyota Camry LE, 1999.
  • lrguy44lrguy44 Member Posts: 2,197
    The perfect world for Ford is to drop Mercury and have all dealers remaining be Ford-Lincoln dealers.
  • sterlingdogsterlingdog Member Posts: 6,984
    "But, I believe they are rated 80k miles."

    I'm glad that you mentioned that figure because I thought that I had read it in some literature.

    I'm glad about the good traction. We're expecting 100% rain tomorrow and my wife has to go out of town for a meeting. I'll feel better about her driving with those new tires.

    If you paid about the same price two years ago, then I guess that I got a pretty good deal from my dealer. Things are so high now. I'll tell you one thing. I've never seen so much rubber on new tires. They remind me of a bulldozer or tractor. :P

    Richard
  • joel0622joel0622 Member Posts: 3,299
    +1

    I agree 110%. IMO Mercury is dead weight. If they put the Lincoln line into a Ford store and let us market the MKZ we would do wonders with it.
  • sterlingdogsterlingdog Member Posts: 6,984
    "Must be stock owners of the big oil companies buying your cars."

    He probably has some AIG executives and bankers as well. They have to spend those bonuses you know. :P Still, we have to be happy for Moo.

    Richard
  • sterlingdogsterlingdog Member Posts: 6,984
    "So you got the first one 'free'?"

    Yes, I thought about that mode of advertising. Still, I got 25% off which makes me happy. Another factor that I like besides the tires is the excellent service and trust that I feel for my dealer. It's hard to put a price on that.

    Richard
  • fezofezo Member Posts: 10,386
    I assume that Ford is trying to do what they did locally - get the LM dealership consolidated with the Ford one. If they can more or less complete that dropping Mercury would be a snap.

    I'll bet there are still a few stand alone Mercury dealers out there. When Chrysler dropped Plymouth there were still a few stand alone Plymouth guys. I always wondered how they hung on so long.
    2015 Mazda 6 Grand Touring, 2014 Mazda 3 Sport Hatchback, 1999 Mazda Miata 2004 Toyota Camry LE, 1999.
  • sterlingdogsterlingdog Member Posts: 6,984
    When your little egghead gets ready, I will also be ready to sell. Just let me know.

    Richard
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