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“From our neighboring dealerships, the going rate charge is cost plus 15%, which is a premium price and a little steep,” he said. “If you’re selling the part to one of our wholesale shop customers, we’re already giving them a deep discount. So, we are taking a real beating on those orders and selling those parts at a loss. Serving the customer is our priority here, and this is one of the realities we have to deal with.”

In today’s wholesale parts world, the contenders are separating themselves from the pretenders, a trend that will continue, Monteleone said. “The differences between a parts manager who is a strong retailer and focusing on profitability versus someone who is slinging a lot of paper to sell at a high volume are becoming more and more evident,” he said. “We definitely want to be on the right side of this and that’s why we work so hard to be keep our wholesale customers happy while being profitable overall.”

What’s the solution?

“I can buy the parts from Walmart and make more money, so that’s what I did,” he said. “I made a big purchase and when my factory rep came in for a visit, she was surprised and a little perplexed to see a wall of parts I bought at Walmart. I told her I won’t be buying certain parts from you anymore because I can get them cheaper at Walmart. She didn’t know what to say! I originally discovered this a few years back in Florida and the same thing is happening now in Texas.”

Right now, Walmart isn’t retailing crash parts and is focusing on marketing DIY types of parts. But no one would be surprised if this trend could gain momentum in some states to the point where certain collision parts and products could be undercut by large retailers.

“The OE wants to cut out the middle man and eliminate the jobbers, to be honest,” Monteleone said. “They all want to go direct and that’s why they’ve done things like cutting their return allowances in half, for example. Why are we selling our parts at a deep discount while the manufacturers have decided to work with Walmart? It makes no sense.”

New-vehicle sales in January are expected to reach 1.01 million units, a drop of 8.9% compared to January 2021, according to a forecast released Jan. 26 by Cox Automotive.

The January pace of U.S. auto sales, or seasonally adjusted annual rate (SAAR), is forecast to show a sizable monthover-month improvement and finish near 15.3 million, up from 12.4 million in December, which was the slowest pace since May 2020.

Improvement in the January sales pace is a positive sign for the market, but it is mostly due to seasonality adjustments. In fact, there haven’t been any significant market changes to positively impact sales.

New vehicle sales remain stuck in the 1 million to 1.2 million range. January is expected to continue this trend, as the market continues to be held back by tight inventory. New-vehicle inventory is starting 2022 down 61% from last year—that means 1.2 million fewer vehicles available at the start of 2022 compared to the start of 2021.

According to Charlie Chesbrough, senior economist at Cox Automotive: “A large decline in sales to start the year after a robust holiday shopping period is expected, and adjustments are made to sales data to reflect this. In January, the seasonal factors will reveal that, even though sales volumes are stuck in their current range, the market is moving in the right direction and, importantly, not getting worse.”

Source

Audi Part Professionals are experts on collision parts, replacement components and mechanical items.

Order Audi Genuine Par ts from these select dealers.

C A L I F O R N I A Audi Rocklin

Rocklin

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Circle Audi

Long Beach

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Niello Audi

Sacramento

916-480-2851 916.483.1963 Fax M-S 8am-5pm audi.parts@niello.com www.audi.niello.com

Santa Monica Audi

Santa Monica

310.481.8216 310.393.6982 Fax M-F 7:30am-5pm wholesale@santamonicaaudi.com www.santamonicaaudi.com

WA S H I N G T O N Audi Seattle

Seattle

206.634.8200 206.547.1581 Fax M-F 7am-6pm parts@uvwaudi.com www.audiseattle.com

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