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A R K A N S A S
CAR BUSINESS O F F I C I A L P U B L I C AT I O N O F T H E A R K A N S A S I N D E P E N D E N T A U T O M O B I L E D E A L E R S A S S O C I AT I O N
KEEPING YOUR WEBSITE AHEAD OF THE CURVE ALSO From PC to Pocket PLUS Cars.com Extends Chat to Mobile Devices
DALLAS, TEXAS Permit No. 2079
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PRSRT Standard U.S. Postage V I S I T
U S
A T
W W W . A R K I A D A . O R G
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INSIDE vAuto becomes part of AutoTrader.com AutoTrader.com and vAuto announced in September an agreement under which AutoTrader.com will acquire vAuto, the automotive retail industry’s leading provider of advanced software tools for used vehicle management, pricing and inventory optimization. The terms of the
deal are not being disclosed. vAuto will operate as a subsidiary of AutoTrader.com and the two companies will operate largely independently, although they will collaborate in the areas of product development and customer training. Going forward, dealer customers of both AutoTrader.com and vAuto can expect to see enhancements to both companies’ products and services, such as more real-time, market demand-driven tools that will benefit their businesses. “Over the past decade, the Internet has enabled consumers to have a tremendously more transparent view of used vehicle availability and pricing on a local, regional and national basis,” said AutoTrader.com President and CEO Chip Perry. “This change in the way consumers shop for cars has created a strong need for dealers to efficiently manage and merchandise their vehicles in a way that ensures they remain competitive. As a result of these trends, the many dealers who use third party classifieds sites like AutoTrader.com and who also employ state-of-the-art inventory management and pricing tools like vAuto are generating strong growth and profitability even in the face of a soft automotive market.” vAuto will maintain its management team; founder Dale Pollak and president Keith Jezek will remain with the company at its headquarters in Oak Brook, Ill. “I am excited to see vAuto join forces with AutoTrader.com because our two companies share a common passion for helping dealers leverage the Internet through strong product innovation and customer service,” said Pollak. “Together we are intent on ensuring that customers of both vAuto and AutoTrader.com will continue to benefit from the expertise and consulting services that they’ve come to depend on and trust. AutoTrader.com is a majority-owned subsidiary of Cox Enterprises, which also owns auction giant Manheim.
Chairman of the Board Kenneth Caruthers Caruthers Auto & Equip. Sales McRae
PRESIDENT
Jim Bullard Spa Auto Sales Hot Springs
STATE VICE
President Sylvia Curry Jacsil Motors Pine Bluff
REGIONAL VICE PRESIDENTS
Region One Heather Healy Vehicle Title Services Little Rock
REGION TWO
Al Pledger Al Pledger Motors Russellville
REGION THREE (Open)
REGION FOUR
Kurt Weiand Pioneer Auto Auction Hardy
SECRETARY
Dane Reed Dane’s Auto Sales Pine Bluff
REGION FIVE
Fran Chatman Don Cavenaugh Motors Walnut Ridge
REGION SIX
J. W. Spencer J. W. Spencer Motor Co. Wynne
REGION SEVEN Kent Stegall Kent Stegall Used Cars El Dorado
REGION EIGHT
Wilt Leak Magnolia Motor Co. Magnolia
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From PC to Pocket Cars.com Extends Chat to Mobile Devices Manheim Urgent Message Keeping Your Website Ahead of the Curve
THE CURRENT STATE OF THE AUTO INDUSTRY John McElroy is host of the long-running "Autoline Detroit" television program, covering all aspects of the automotive industry. In this presentation, McElroy provides a thorough and insightful review of where we've been, where we now are, and where our industry is headed. Taped at the Automotive Fleet & Leasing Association's Annual Conference.
CATCH THIS ON WWW.NIADA.TV
ADVERTISERSINDEX ADESA................................................Inside Back Cover AutoTrader.com ............................................Back Cover Cars.com ............................................Inside Front Cover Manheim.com ............................................................11 SmartAuction................................................................7 Southern Pioneer Insurance ........................................5 Western General / Protective ......................................3 NATIONAL INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION WWW.NIADA.COM • WWW.NIADA.TV NIADA HEADQUARTERS: 2521 BROWN BLVD. • ARLINGTON, TX 76006-5203 PHONE (817) 640-3838 FOR ADVERTISING INFORMATION CONTACT: TROY GRAFF (800) 682-3837 OR TROY@NIADA.COM.
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FOR INFORMATION ON HOW TO BECOME A MEMBER PLEASE CONTACT: AIADA EXECUTIVE DIRECTOR LAMAR MURPHY PHONE: 870-234-9468 WEB SITE: WWW.ARKIADA.ORG
THE ARKANSAS CAR BUSINESS IS PUBLISHED BI-MONTHLY BY THE NATIONAL INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION SERVICES CORPORATION, 2521 BROWN BOULEVARD., ARLINGTON, TX 76006-5203; PHONE (817) 6403838. PERIODICALS POSTAGE PAID AT DALLAS, TX AND AT ADDITIONAL OFFICES. POSTMASTER: SEND ADDRESS CHANGES TO NIADA STATE PUBLICATIONS, 2521 BROWN BOULEVARD., ARLINGTON, TX 76006-5203. THE STATEMENTS AND OPINIONS EXPRESSED HEREIN ARE THOSE OF THE INDIVIDUAL AND AUTHORS AND DO NOT NECESSARILY REPRESENT THE VIEWS OF ARKANSAS CAR BUSINESS OR THE NIADA. LIKEWISE, THE APPEARANCE OF ADVERTISERS, OR THEIR IDENTIFICATION AS MEMBERS OF NIADA, DOES NOT CONSTITUTE AN ENDORSEMENT OF THE PRODUCTS OR SERVICES FEATURED. COPYRIGHT 2010 BY NIADA SERVICES, INC. ALL RIGHTS RESERVED.
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FROM PC TO POCKET: CONNECTING WITH SHOPPERS ON THE MOVE Internet access from mobile devices is a hot topic for automotive marketers. It’s also an important one. Mobile Web growth is so strong, it’s suggested mobile usage will overtake traditional Web access from wired devices (desktops and laptops) in just three years. That means you need to start thiking today about how this technology might affect your business in the near future. First, let’s define the mobile Web. It refers to any browser-based access to the Internet or Web applications (or apps) using a mobile device. There are many different types of mobile devices, but by this time next year, smart phones (i.e., the iPhone, Blackberry, Android, etc.) will be the dominant type of phone. This information is important because smart phones are the most efficient and effective mobile devices for accessing the Internet. More importantly, it’s on the smart phone where advertising and shopper engagement can happen. Now let’s talk about how consumers use mobile devices as part of the vehicle shopping process. At any given time, about 50 million Americans are shopping for a car, and up to 6.2 million are using their mobile phones during that process. However, there are some key differences in shopping behavior when car shoppers are on the go versus using a PC or laptop from their home or office. FOR EXAMPLE, MOBILE SHOPPERS ARE TYPICALLY: • Closer to making a purchase • More likely to be looking at content related to their final selection and/or purchase • Not close to a PC and therefore not conducting extensive research In addition, the mobile shopping cycle appears to complement the traditional online shopping cycle. According to AutoTrader.com site statistics, online traffic from a laptop or PC is the highest at the beginning of the week and gradually declines as the weekend approaches. But how does mobile Web use compare? AutoTrader.com site usage also shows a dramatic increase in mobile access to our site over the weekend. This information reveals there is a natural continuity between the research that car shoppers are doing Monday through Friday and their trips to dealerships at the weekend. The most valuable thing you can do as a dealer is develop a strategy to stay connected to vehicle shoppers when they take that shopping experience from their PC to their pocket.
MOBILE CONSIDERATIONS FOR YOUR DEALERSHIP TALK TO YOUR WEBSITE PROVIDER Ask your website vendor if your site is mobile device-friendly. Go ahead and check it out from your own phone. What do you see? As you evolve your dealership for the future, think about optimizing your virtual showroom for the mobile web. KEEP YOUR LISTINGS IN FRONT OF IN-MARKET CAR SHOPPERS WHEREVER THEY ARE Make sure your inventory is listed on third-party sites that offer a satisfying mobile web experience for car shoppers. Independent sites such as AutoTrader.com have streamlined mobile sites that allow dealers to stay connected to in-market shoppers when they go mobile. ENSURE YOUR CONTACT INFORMATION IS FRONT AND CENTER ON YOUR DEALERSHIP SITE Remember earlier when I mentioned consumers aren’t conducting extensive research on their mobile phones but instead are more likely to be in the final stages of making a purchase decision? What if that decision was to walk into your dealership but they need to look up your street address or phone number from their mobile device? Make it easy for them. Keep your dealership contact information prominent on your homepage. Even from wired devices, consumers don’t like to navigate through several pages to find basic information, and they’re even less likely to do it on their cell phone where the screen is small and the page loading time is slower.
“
At any given time, about 50 million Americans are shopping for a car, and up to 6.2 MILLION are using their mobile phones during that process.
6.2
BASIC BLOCKING AND TACKLING IS STILL THE MOST IMPORTANT THING Advances in the technology for the mobile web are great opportunities for dealers to stay connected to car shoppers during all stages of the shopping process. However, effective online merchandising should be the higher priority before investing time and money in mobile platforms. Tori Morandi has more than 10 years of experience as a public speaker and expert trainer as well as extensive in-dealership experience. As an industry educator for AutoTrader.com, she covers what's happening in the automotive market, consumer car shopping behavior, emerging trends, and what's new with advertising and marketing on the Internet.
BY TORI MORANDI, manager of industry education, AutoTrader.com 6 ARKANSAS CAR BUSINESS
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>> on-the-go access
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Cars.com Extends Online Chat to Mobile Devices to Help Dealers Connect with Shoppers
Cars.com dealers using the company’s free online chat functionality can now communicate with customers from their Internet-enabled smartphones. The company added on-the-go access to its chat platform to create new opportunities for dealers to connect with buyers. “Mobile chat allows salespeople to be more responsive to shoppers' inquiries, even if they've stepped away from their desk," said Michael Page, Cars.com vice president of advertising products. "Dealers can respond at shoppers' convenience, giving them the information they need to take the next step toward a purchase. With the popularity of smartphones in the store, dealers can use this capability to enhance their customer service and sell more cars." At Buster Miles Chevrolet Dealership in
Heflin, Ala., sales consultant Phil Amason said he appreciates the immediacy of chat. "It’s definitely been a plus for our store. It’s a better way for customers to reach us live and for us to respond. They get immediate access to the information they need, and I think that’s really key.” Amason, who added online chat about a year ago, reported an increase in business after he began testing the new mobile chat enhancement. “I was able to accept two chats last month that I would not have been available for if it weren't for mobile chat. I know this resulted in two sales. They were two hard, trackable sales," he said. “In my experience, appointment rates are higher with live chat compared to traditional email and phone appointments. There seems to be a better quality interaction because of minimal delay in response."
Dealers interested in adding chat functionality to their online advertising package can contact their sales representative. To help dealership sales teams incorporate chat into their sales process, Cars.com presented “Chat Up Your Inventory: Leverage Chat to Reach In-Market Shoppers and Win Sales" through its DealerADvantage Live webinar series. A recording of the free workshop is available at http://dealers.cars.com/live. Cars.com launched online chat for its customers in January 2009 at no additional charge as a way to help dealers connect with more online shoppers. The technology is delivered through a partnership with Contact At Once! Mobile chat capabilities are made available as part of a renewed agreement, also announced last month, between the two companies.
Car Charging Group, Inc. Partners With Icon Parking in Manhattan to Offer Electric Vehicle (EV) Charging Stations Car
Charging
Group,
Inc.
(OTCBB:CCGI) recently announced it has
entered into a pilot agreement with Icon Parking Systems, the premier provider of parking services in Manhattan, to provide electric vehicle (EV) charging stations at select trial locations helping to smooth the transition to EV by creating a useful charging network for Icon's customers.
"This partnership lays the groundwork in Manhattan to support the national rollout of electric automobiles on the way to dealer showrooms in late 2010 from manufacturers such as Tesla Motors, the Renault and Nissan alliance, General Motors, Ford and others," said Car Charging Group CEO Michael D. Farkas. Car Charging Group plans to install Level II (240 volts) ChargePoint® Networked Charging Stations for EVs which are manufactured by Coulomb Technologies (www.coulombtech.com), the industry leader in electric vehicle charging infrastructure. Through the aid of government tax incentives, subsidies, loan guarantees and grants, Car Charging provides EV charging stations at no charge to property owners and managers while retaining ownership, thus allowing
drivers access to convenient locations and partners to realize a percentage of the charging revenue generated. "By partnering with Car Charging Group, we are poised to meet the increased demand from electric car owners while simultaneously working towards transportation solutions that are more sensitive to the environment," said Paul Regan, vice president of Operations, Icon Parking Systems. Icon Parking Systems operates more than 200 parking facilities in Manhattan. Many of Icon's locations are in the city’s busiest and most vibrant commercial neighborhoods, others can be found near famous New York City landmarks, and many are in residential areas throughout the city. Vehicle owners can shop for monthly, hourly and daily parking, find great discount coupon offers and compare facilities by visiting Icon Parking at www.iconparking.com. Last month, New York joined other cities including San Francisco, Austin and Detroit, as part of a nationwide push to add infrastructure for plug-in cars by installing its first public electric-vehicle charging station. According to New York City Mayor Michael Bloomberg, the city now has 6,000 alternative fuel vehi-
NEW YORK CITY AREA PARKING COMPANY TO PROVIDE ELECTRIC VEHICLE CHARGING SERVICES cles in its fleet of 26,000 vehicles. "Driving a vehicle with no engine and no exhaust is an attractive option to Americans so we anticipate that the upcoming introduction of mainstream electric vehicles by major manufacturers will usher in the mass adoption of electric vehicles," said Brian Golomb, director of sales and marketing, Car Charging Group. "Access to charging stations outside of the home, at convenient locations like parking facilities, will make people more comfortable about investing in EVs and eliminate range anxiety fears."
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SECURITY ALERT
URGENT MESSAGE FOR ALL AUCTION MEMBERS Manheim Corporate Security
FEDERAL ADVOCATES LOBBYING REPORT
Date: Aug. 18, 2010
WHITE HOUSE REFORM REQUEST
TO: All GM’s and AGM’s
On September 23 and September 29, Federal Advocates was contacted by the White House, which is trying to organize and schedule a meeting to include “people who are working to setup the CFPB.” This meeting is in response to a letter sent by NIADA to President Obama requesting “the opportunity to work with you to reform our industry in common-sense ways that achieve real safeguards for consumers, that promote accountability and transparency, and that really work.”
CC: All Front Office Managers and All Security Managers FROM: Alan Walker, Director Corporate Security STATUS: High Importance ISSUE: Interstate Suspect Alert #3 Suspect: PRICE, Shawn D. - Black Male Adult, 5ft 11 ins tall 230 lbs. D.O.B. 09/13/74 (It is believed this suspect is the same person who was using the name, Marcus EDWARDS and a fake IL DL pictured in prior alerts)
Our Interstate Suspects have struck again. The suspect listed above is using a fake Wisconsin Drivers License as identification. He stole 3 vehicles from Nashville Auto Auction TN in the evening of Monday August 16th. The gate releases had been left at security after 3 separate phone calls had been placed to the front office requesting No Sale releases. His description matches the person who is responsible for vehicle thefts from our auctions in Fredericksburg VA, Manheim PA and Atlanta GA. This is preventable; if you have all personnel who receive phone requests for No Sale Releases from an individual they do know, confirm the request with the Dealership/Owner using contact info from our records.
SMALL BUSINESS JOBS AND CREDIT ACT OF 2010 On September 23, the House passed the Senate-passed bill, which includes an increase in the amount the Small Business Administration’s (SBA) Dealer Floor Plan Financing program can guarantee. This permits the SBA to guarantee bank and finance company loans up to $5 million, which should help, the committee believes, expand dealer access to floorplan lines of credit. We worked with Louisiana Democrat Sen. Mary Landrieu’s committee and personal staff, in conjunction with others, on this. This bill may be the subject of subsequent meetings with Capitol Hill and the SBA on how the
WALL STREET/CONSUMER FINANCIAL SERVICES REFORM BILL On September 21, Keith Whann and Federal Advocates met with staff of the Federal Trade Commission (FTC): James Dolan, assistant director; Carole Reynolds, senior attorney, Division of Financial Practices; Rebecca Kuehn, assistant director, Division of Privacy and Identity Protection; Katherine Worthman, attorney, Division of Financial Practices; and Daniel Hanks, attorney, Division of Marketing Practices. The meeting covered implementation of the above bill and its impact on the auto industry. Following discussion of various issues, including Buy HerePay Here issues, with NIADA General Counsel Keith Whann leading the discussion and answering various questions as to how the auto industry segments work, which also covered the auto auction process, it was decided to schedule another half day session in the following weeks to allow for a more detailed discussion of issues. To review, on July 22, President Obama signed into law the so-called Wall Street Reform Bill. As reported previously, the new law exempts certain auto dealers from increased oversight with respect to dealer-assisted financing. To get to that result, advocacy activities over the past month included numerous meetings, strategy phone conference calls, letters, talking points, legislative alerts and more. The law does grant increased powers to the FTC regarding dealer oversight. Also, it requires coordination with the Defense Department (DOD) to ensure service members and their families are treated fairly by automobile dealers.
DEPARTMENT OF DEFENSE Regarding the issue of “how to ensure that service members and their families are treated fairly by automobile dealers,” Keith Whann and Federal Advocates also met on September 21 with Frank Emery of the Defense Department’s Family Policy Outreach Directorate. Whann relayed a specific example of how he helped a service member at Fort Bragg, N.C., regarding an automobile situation, working with the base Judge Advocate General’s office and others. He also talked about a plan for a special program to teach dealers on how to deal fairly with service members and their families. Emery mentioned a November conference in Denver where Keith could give a presentation. Details are to be finalized at a later date.
FEDERAL ADVOCATES IS NIADA’S GOVERNMENTAL ADVOCACY PARTNER. To read past lobbying reports, visit http://www.niada.com/legislative_and_legal.php
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YOURWEBSITE Keeping Your Website Ahead of the Curve Technology has advanced and changed more in the last ten years than it has in the last 100 years combined.
This is mainly due to the Internet era and things are looking like they’ll only speed up from here. When consumers purchase a vehicle from your dealership, the first thing they have the option to do is to make it their own by adding custom accessories. Websites are very similar, and there are many aftermarket accessories you also can add on to your site to make it unique. Making sure your site and computer are up to date is easier than you think, and doing so will allow you the ability to get the maximum benefit with the least amount of effort. Over the last several years, website providers have been slowly shifting the ability and power over to the webmaster or site owner. This puts you in the driver’s seat by allowing you more access to add functionality by editing the content, changing out photos and even adding simple HTML code. If your website provider does not allow you to edit content on your site, you still can utilize the items listed below by having your site provider add them for you.
BROWS ER UPDAT ES Now you can’t put the cart in front of the horse, as they say, so we need to start with updating the browser you use on your computer. This is how you log on to the Internet. The following is a list of the latest browsers so you can determine if you either want to update the version you have now or switch to a different browser. Knowing what your potential customer is using on his or her computer might help you make a decision on what browser you should use, too. We’ve included a list of the latest versions of the top five browsers so you may download the correct version for your computer. You can find these free downloads by simply searching for the below listed items in any search engine: 1. Internet Explorer: version 8 2. Mozilla Firefox: version 3.6.10 3. Google Chrome: automatic updates 4. Safari: version 5 5. Opera: version 10.6.2
By updating to the latest version or even switching to a different browser, you’ll have the ability to keep all of the content saved in your old browser and transfer it to the new version or new browser of your choice along with your favorite websites. Now that your operating system is up to date and in place, let’s make sure you have the ability to correctly track the results your site is bringing to your dealership.
WEBSITE TRACK ING TO O L S Most sites do come with an analytics section, but Google has developed a free tracking system called Google Analytics that’s 100-percent free and can be installed by your website administrator. This tracking system is far more in depth than what’s traditionally provided by your website provider. You can create a free account with Google and gain free access to this tracking system by visiting www.google.com/analytics. This system will allow you to track visitors viewing your website in extreme detail including, but not limited, to the following: • Mobile visitor tracking • Data benchmarking • Internal site search features • Flash tracking • Video and social network application tracking • Advanced segmentation of data • Advanced analysis tools • Analytics intelligence • Custom reporting • Custom set variables • Easy-to-use dashboards • Data exports to transfer all data from the system to spreadsheets
It is impossible to improve upon the re-
sults of your website if you don’t know them. This system will allow you to view any of the data from your site visitors, as well as set up goals for your website traffic so you can reach the desired benchmarks you set for your company with ease.
SO CIAL MEDIA SHARING TO O LS Social media is going viral on the Internet and dealers need to take advantage of it.
Despite many articles you’ve read, just having a Twitter, Facebook, MySpace or LinkedIn account is not going to sell you more cars. The real power of social media is allowing your customers www.AddThis.com to share your inventory online to the friends in their social network. www.AddToAny.com Take advantage of the fact Billy has 2,500 friends and when his www.ShareThis.com friends or family place a vehicle from your dealership on his social networking page, your dealership is instantly exposed to everyone in his network. There are many free tools in the marketplace you add to your site if your provider hasn’t already implemented them for you. The following is a list of the top three sites where you can get free sharing tools to add to your website. By simply adding these sharing tools to your site, you are opening up your dealership to the masses and allowing yourself to make a viral jump in the social media realm.
ADDING A BL OG TO Y O UR SITE Search engines love to see site growth on the weekly visits to your dealership site, as well as links from valuable sources connecting to it. Offsite blogs are great for both of these, as you can link to your dealership site from your blog. Most blogs allow you to have a section you can paste into your site to showcase the most recent blog posting to your potential customers. Because search engines try to match the words people are typing into them to websites, adding automotive related terms in your blog will help tremendously with search engine optimization (SEO). Here is a list of the top 3 free websites that you can sign up for and link to your dealership website. The above listed sites allow you to create your own blog for your dealership as well as customize the design to implement your dealership graphical logos to match the current branding of your dealership. The more avenues that you give the internet with content pertaining to your dealership, the larger the footprint that you will leave on the internet.
MANAG ING Y OUR SO CIAL MEDIA With all of the social media tools available online, it can become a painstaking process to make sure you keep them all up to date. Between Twitter, Facebook, My-
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By Michael D. Jackson, CEO, Auto Search Technologies, Inc. (949) 608-0809 (Direct Line) mjackson@autosearchtech.com
NIADA.COM ALL NEW FOR YOU!
Space, LinkedIn, YouTube, Flickr, FriendFeed, MSN Messenger, AIM Messenger, Google Talk and Yahoo! Chat, you could easily spend all day just updating your social media outlets as you jump from site to site. That’s where www.Yoono.com comes in; it’s a social media management platform that’s free and allows you the ability to update all your social media www.Blogger.com outlets with one of the mouse. Yoono.com offers a browser add-on (recommended) specifically for Mozilla Firefox and Google Chrome browsers; however, for different browsers, you can download a desk- www.WordPress.com top application for Windows (Internet Explorer), Macintosh (Apple), Linux or USB to manage all of your social media channels. www.MyBlogSite.com This tool allows you to update your status across the board as well as share links, images, videos and stay connected on all of your Yoono.com instant messaging channels. Time equals money, and money equals time. The more of both you save will allow you the ability to work more efficiently and accomplish more for your dealership on a daily basis. Making sure you’re utilizing all of the above listed features in your website will tremendously increase your results. By simply setting site traffic goals and staying aware of amount of traffic you’re receiving, you’ll be able to improve upon it on a monthly, quarterly and annual basis.
NIADA has unveiled a brand new website that’s easy to navigate and offers many new technologically-advanced features for dealer members. Among them: • The entire NIADA membership roster is now included on the home page via a state map, and dealer members can opt-in to add more contact info to their online membership listing. • All state magazines published by NIADA can now be viewed inclusive of advertisements. The magazines also will be archived on the site. Plus, those same state associations will have direct links from their websites to our site promoting readership of their particular state magazine. To view these magazines go to http://www.niada.com/state_magazines.php • NIADA National Corporate Partners (NCP) will now have the ability to add a company or product-specific video next to their NCP description.
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New Industry Insight Series Educates Dealers with Free Seminars
CLICK ON NEW PROGRAMS!
ATTENTION DEALERS
THESE DAYS YOU NEED MORE THAN JUST A "WWW" ONLINE PRESENCE. Get the latest scoop on the industry by watching “Automotive Industry News” on NIADA.TV, updated the second Monday of each month. Also view for free over 400 hours of quality dealer education, including many sessions from the recent NIADA Convention. Just log onto www.niada.tv and click on the New Programs section.
SEE BELOW FOR SOME OF T H E L AT E ST P RO G R A M M I N G .
IS YOUR INVENTORY A "CRAP SHOOT?" A perfect inventory is not about luck. It's about knowing how to use YOUR numbers to stock your lot.
In an effort to keep dealers up-to-date on the latest tools, technology and buying/selling trends in an ever-changing marketplace, NADA University and ADESA have teamed up to present a series of free lunchtime educational seminars called “Industry Insight.”
ADESA’s Tom Kontos, president of customer strategies and analytics, was one of a panel of four experts giving industry views to dealers during the first Industry Insights seminar entitled, “What’s Now? What’s Next?” held at ADESA Dallas on September 15. Kontos talked about the used car market’s vehicle supply for rental, lease, repos and dealer consignment. He explained that the remarketing industry obtains supply from a broad array of sources so that it’s not dependent on any one outlet—which, as a result, have kept auction volumes relatively constant. However, the mix of vehi“IT’S NO SURPRISE THAT cles has shifted. REPOS REACHED AN ALL-TIME The turnover of HIGH DURING THE RECESSION — rental fleets was at its BUT THIS SHOULD BEGIN TO TAPER AS THE ECONOMY IMPROVES.” lowest in 2009, but has begun to rebound somewhat this year. ADESA’s Tom Kontos, president of Fleet sales in 2010 are customer strategies and analytics an indicator of future increases in wholesale used vehicle supply in the lane and online. Through August, total sales volume for rental, commercial and government vehicles has increased about 39 percent from 2009. Kontos added both new vehicle sales and lease penetration are on the rise as well as new vehicle lease origination. This means there will likely be more off-lease vehicles on the market in about three years. Kontos noted off-lease volumes will drop slightly this year and then fall significantly during 2011 through 2012. After that, offlease volumes should begin to recover. As credit tightened and new vehicle sales fell, auto loans and outstanding leases declined. Kontos said, “It’s no surprise that repos reached an all-time high during the recession—but this should begin to taper as the economy improves.” Speaking of economic recovery, Kontos said new and used vehicles sales in 2010 are significantly improved from last year. For both the U.S. and Canada, Kontos pointed out that new vehicle sales are up—and that truck sales have grown more than car sales. Since bottoming in November 2008, average wholesale prices have firmed and are likely to continue to be up on a year-overyear basis, albeit more moderately and with typical seasonal ups and downs, during 2010. Tim Zierden, ADESA’s vice president of dealer sales and services, facilitated the event’s lively discussion. Other industry experts who spoke at ADESA Dallas during the “Industry Insight” seminar were: ■ Les Abrams, NADA Academy instructor, who discussed used vehicle inventories and today’s best practices ■ Dale Pollak, vAuto’s chairman and founder, who talked about new technologies, and ■ George Heppe, GigglePop’s president and owner, who explained new mobile Developments.
Attendance at the seminar was favorable with about 50 dealers participating. Please contact NADA University at (800) 557-6232 for information about future Industry Insight events. 12 ARKANSAS CAR BUSINESS
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AIADA
MEMBERSHIP HIGHLIGHTS & BENEFITS
• Vehicle Transportation Services • • Marketing Supplies & Printing Services arkansasCAR BUSINESS
Autozone discounts for automotive parts and supplies
To become a member contact Lamar Murphy at 870-234-9468
SIGN-A-FRIEND CREDIT TO: (your name) ________________________________________________________________________________________________
A P P L I C AT I O N F O R M E M B E R S H I P Type of Membership: Regular _____________ Associate _______________ (non-dealers) _______________ New Member: (company) ___________________________________________________________________________________________ Owner’s Name:___________________________________________________________________________________________________ Mailing Address: _________________________________________________________________________________________________ City/ State/ Zip: __________________________________________________________________________________________________ Phone Number:
______________________________________ Fax: ______________________________________________________
E-mail Address: ____________________________________________________________________________________________________ Kind of Business: (check all that apply) Independent___
Franchise___ Retail____
Buy Here Pay Here____ Wholesale____ Auction House____
Body Shop____ Re-builder____
Salvage Yard____ Classic Cars_____ ANNUAL DUES $200.00 • MAKE CHECKS PAYABLE TO: AIADA • P.O. BOX 147 • MAGNOLIA, AR 71754
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BEST PRACTICES
FOR GETTING YOUR CUSTOMERS FINANCED BY GEORGE HARTMAN Director, national business development, RouteOne LLC
George Hartman is the director of national business development at RouteOne LLC, a free, online credit application management service for franchised and independent dealers nationwide. RouteOne’s credit platform allows automotive dealers to submit credit applications to a wide variety of lenders, including prime, sub-prime, banks and credit unions. RouteOne offers dealers a vast array of F&I tools including credit bureau access, DSP integration, free reporting, and a host of subscription-based tools, with no long-term fees or contracts required at any time. RouteOne offers dealers a common platform for all their credit application financing needs. More information is available by contacting Hartman directly at 248-862-7050 or ghartman@routeone.com. Dealers may also contact RouteOne Sales Support at 866-933-0663 or salessupport@routeone.com.
In this economy, it’s imperative that your dealership take advantage of every opportunity to get your customers financed. Each deal is unique, but your best chance to fund each and every deal is to pay attention to the basics. Let’s focus on
a key tenet: your finance source selection and partnership. Know the finance source policies. Knowing and following your finance sources’ guidelines for receiving applications can make or break your approval success rate. Additionally, understanding how to package your final deal will also speed your funding. Find out your finance sources’ policies regarding cash down, credit scores and scoring models, model year/mileage restrictions, PTI, and LTV. What about the lender’s book value (which book do they advance on?) Is your value accurate? Verify contract accuracy. Verify the accuracy of your contract prior to submission to the finance source. Are you sending the customer application to the finance source most likely to fund that candidate? Check customer quality, vehicle selection and advance sought. Create a complete funding package. Know the stipulations prior to delivery! Always create a checklist, whether packaging the deal on your own or providing to a clerk. Make sure you include all relevant data. Verify all stipulations prior to sending, and verify that all standard documents are included, complete and accurate. For example, a promissory note for $500 down could cost you time and effort to track down, maybe even a $500 write off. The missing stipulations for POI could cost your dealership $25,000 in funding, or worse, loss of an approval due to expiration - not to mention the frustration if the bank decides not to re-approve! Ensure your customer meets program guidelines. In times past, ’cash was king’. This is not necessarily true anymore. It’s possible that your customer could meet 99 percent of minimum pro-
gram guidelines – but missing that one percent could cost you the deal! So make it easy on yourself. Don’t submit a deal with $250 cash down knowing the program minimum is $500. You may not receive a counter offer for an additional $250 down - you may just receive an “automated turn down”. (Did you know some finance sources have policies which prevent them from rehashing a turndown?) Avoid “shot gunning” deals. Shot gunning does not work to your advantage or speed your process. Actually, it does just the opposite. These days, finance sources are very tightly managing risk and cost. As a result, look to book and risk portfolio management are more critical than ever. Build relationships. It’s important for you, the dealer, to build a solid relationship with your lenders. Get to know them and request that they provide you or your staff the training, education or feedback needed to have a successful partnership. Be accurate. Avoid vehicle value errors or ‘power booking’, ‘grossing up,’ or otherwise enhancing the truth. It may seem harmless to round up an applicant’s income to the nearest “x”, or even provide a luxury vehicle with all of the bells and whistles, but it is not in either your, or the finance sources’, best interest. Your customer could have provided an application for credit using a different income at a different location, thus creating a discrepancy. This could delay your approval, create additional stipulations or worse, cause a decline. Additionally, many finance sources are now completing their own customer interviews, either at random or generated based on the finance source’s risk assessment of your dealership’s performance or repossession rate. The ‘power booked’ car may have provided a nice advance and appearance of profit to your dealership, but if a discrepancy is found, you could be charged back, or even lose a finance source. Most importantly, communicate with your lenders at every turn. It’s never too late to be a great partner. Good selling!
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