June 19, 2016
Here’s wishing everyone a great Father’s Day.
June 8, 2016
June 1, 2016
This is Don Wassel, he is retiring tomorrow after 50 years of selling cars. Read his complete story here.
May 18, 2016
The best thing about the “old” Ford Ranger was that it came with so many options that it could confuse even the best car buyer.
Big V-6/Small V-6/4 Cyl
Regular cab/Extended Cab
Unfortunately, the 2019 version will not have the Splash model as an option, but it will come in both a 4 cylinder and a V-6 option. Click here for the Car & Driver article on the New Ford Ranger.
May 14, 2016
The best thing about Saturdays in the Used Car business is that it can literally change your whole week. You can transform a poor week into a great one in just one day. So, if you did have a worse Friday than Honda, today is the day to turn that unhappiness upside down!!
May 13, 2016
How was your Friday?
I’m betting it was better than Honda’s Friday.
The company announced Honda Quarterly Results (a loss of $566 million) for the quarter that ended March 31, and they were not pretty. Of course, it’s difficult to turn a profit when you’re recalling more vehicles than you sold last year.
If by some chance you had a worse day than Honda, you have my condolences for having a truly shitty Friday.
May 2, 2016
Although CarMax is unique in the used car industry, their brand awareness can be duplicated by other dealerships. Since their inception, CarMax has had a constant focus on their brand, their message, and on their reputation—even if that meant losing a deal or leaving money on the table.
Forbes interviewed David Canaan recently, and he discussed the valuable asset that is CarMax’s brand. Read interview here.
March 5, 2015
February sales numbers are in and they are a bit low. Estimates were for an annualized rate of 16.7 million units. The number came in just short at 16.23 million.
All manufacturers (except VW) saw sales increase, but below expectations. Most notably, Toyota’s sales rose 13.3%.
For the complete Business Insider article, click here.
Feb 21, 2015
Here’s a visual guide to each state’s most popular vehicle. I must admit, I did not expect Subaru to have such a strong showing. For the entire article, click here.
Jan 22, 2015
Danger! Danger Will Robinson! Danger!
In a recent Bloomberg article, a top Honda exec pontificates about what is driving the US car market. The answer? Cheap, long dated automotive credit.
Jan 20, 2015
For the past seven years, The Used Car Voice has provided you with the best information affecting the lives of used car professionals. This year, we are going to focus some attention on broader dealership themes. The first theme being Dealership Marketing Tips.
Jan 1, 2015
Wishing you the best and most profitable new year possible!!
Dec 9, 2014
We’ve been away for some time, but we’re back, and just in time for the holiday car buying season.
Yesterday on CNBC, a story caught my eye. In 2014, for the first time, Americans will buy over 1 million vehicles with a price tag of over $50,000.
$50,000 is quite a large number. I can remember when $20,000 was a lot to spend on a vehicle.
For the complete CNBC story, click here.
And don’t forget the Used Car Professionals on your list this Christmas season, grab a copy of Used Cars 101.
May 8, 2013
Toyota is out with their first quarter numbers. The Japanese car maker more than doubled their profit versus the same period last year. Their first quarter profit was a whopping $3.2 Billion. This can be attributed to cost cutting as well as a severely depressed yen and a narrow spread between used and new Toyotas. For the AP article click here.
March 9, 2013
It appears that change may be coming soon to Carfax. Reuters reported yesterday that Carfax’s owner, R.L. Polk & Co, is considering selling the company or possibly taking Carfax public. For the complete Reuters story, click here.
February 28, 2013
While many are trying to avoid investing in Europe and Great Britain, American automotive retail conglomerates are diving in as fast as they can. Check out Group One Automotive News for more details about the company’s recently announced expansion plans.
February 19, 2013
Asbury Automotive Group is out with their fourth quarter earnings. This Duluth Georgia based company said it’s 4th quarter net income rose 6%. Their revenues were up 15%. Their new vehicle sales were up 21% while their used vehicle sales were up 8%. For more on Asbury’s quarter, click here.
January 27, 2013
We all know how important the developing world is to the major auto manufacturers, just check out their sales numbers from China and South America. But are these countries important to the major dealership companies also?
Well, Group one certainly thinks so. The company just agreed to buy 18 dealerships in Brazil. For the complete story, click here.
January 23, 2013
Today in CarMax News, it appears the used car giant is headed to Kmart in Milwaukee.
January 17, 2013
For the ninth consecutive year, Carmax has been named to Fortune Magazine’s “100 Best Companies to Work For”. Congratulations to CEO Tom Folliard and his management team on their accomplishment. For the complete list, click here.
January 13, 2013
In any sales or customer facing job, it’s important to stay positive. But, let’s take a moment and focus on the negative. And by this, I mean the truly negative. We take a humorous look at disastrous purchasing decisions with the Worst Used Car Purchase.
January 9, 2013
America’s Car-Mart announced the opening of their newest store, in Woodstock GA. The new dealership located just north of Atlanta marks the company’s 119th dealership. According to the CEO, Hank Henderson, the company plans on opening a total of 10 new dealerships this coming fiscal year. Currently the company operates in smaller cities throughout the Southern and Central parts of the United States.
January 4, 2013
2012 is officially in the books, and it was another banner year for U.S. vehicle sales. The total number of cars and light trucks sold was up 13% from last year, which equates to 14.5 million units, the largest number sold in the U.S. since 2007.
Nearly every manufacturer increased their sales from last year. Toyota, Honda, and Nissan were finally fully recovered from the Tsunami, and their sales numbers showed it. Leading the way, Toyota’s sales were up 27% to 2.08 million units. VW had a 31% increase in sales and ended up with 577,443 deliveries. Chrysler had their best year since 2007 selling 1.65 million units. Rounding out the domestic manufacturers, GM sold 2.6 million and Ford delivered 2.24 million units.
Lastly, these terrific sales numbers should continue into the new year. Given the advanced age of America’s fleet and the improved macro conditions, the industry is expecting to sell over 15 million vehicles in 2013.
January 1, 2013
All of us at the Used Car Voice would like to wish all of you a safe, healthy, and profitable New Year.
The beginning of a new year always feels like the slate has been wiped clean; profits go to zero, but so does wholesale loses, and other nagging issues. In this New Year, what needs to happen to make 2013 your most profitable year yet? Whether it’s hiring more or better salespeople, purchasing better inventory, having a better pricing strategy, or hundreds of other potential solutions, there is no better time than the beginning of the year to think about such things. Putting your time and energy into planning is a valuable step to increasing profitability. Good luck this year.
Dec 11, 2012
The end of the month is often a stressful and demanding time for car dealerships. Every department wants to hit their monthly targets, especially the used car department. With this in mind, we have a new article about Swapping Used Cars that deals with one important aspect of the month end inventory management process.
Dec 4, 2012
Today in AutoNation News, the company announced their November sales as well as detailed plans for expansion.
Nov 18, 2012
We have officially entered the 2012 Holiday Season. The holidays bring us opportunities to share quality moments with our family and friends. But, they also bring much fewer cars to the auction lanes. When planning your purchases this week, and for the upcoming weeks, be certain to accommodate for the holiday disruptions to the wholesale car market.
Oct 23, 2012
Both the Asbury Group and Sonic Automotive released their third quarter earnings today. Both retailers showed an increase in sales.
The Asbury Group’s profit increased an impressive 68% from the previous year. Used vehicle Revenue increased 5.4%. For the complete run down on Asbury’s numbers, click here.
Sonic Automotive reported adjusted earnings of $21 Million, helped by higher vehicle sales. For the complete run down of Sonic’s numbers, click here.
Oct 17, 2012
Today in the Used Car Voice, we take a look at Online car auctions vs. Traditional car auctions. See it at Used Car Auction Online.
Oct 10, 2012
Today in Penske Automotive Group News, the Penske organization expands their Orange County California presence by purchasing Savage BMW and MINI of Ontario.
Oct 6, 2012
September auto sales numbers have been released and some manufacturers did worse than previous years and some performed much better.
General Motors posted a 1.5% increase from their September 2011 results. With Buick making a surprising 7.9% gain from last year.
Ford just barely missed matching their September 2011 mark. They fell short by .1%. Very light truck volume (7.6% decline) explains the slide from Ford.
Toyota saw massive gains by posting a 41.5% increase for September.
Aug 24, 2012
Tomorrow is Saturday and everyone knows how important Saturday sales are to a car dealership. Check out Saturdays At A Car Dealership for a humorous and insightful look at this important day.
Aug 14, 2012
Detroit consulting firm Urban Science released a report today that suggested automotive retailers will hit an all time “sales per dealership” in 2012. These numbers are based on their estimate of 14.3 million vehicles sold. They also state that the reduction of dealerships in the past 5 years is a major contributor to this accomplishment.
Urban Science also released their first numbers on the Chinese automotive dealership industry stating that there are currently 19,890 dealerships in China selling an estimated 19.5 million vehicles. For the entire Bloomberg article, click here.
July 26, 2012
Today in Group One Automotive News the CEO, Earl Hesterberg, gives an insightful interview with CNBC.
A Pennsylvania woman, Patricia Smith, was found guilty today for embezzling over $10 Million from Bairel Acura. Patricia was the dealership’s controller and through electronic withdrawals more than $10 Million over a seven year period ($4,000 a day).
Her purchases include: Super Bowl Tickets (why not?), several private jet rides, 4 homes, 10 vehicles, and over $1.8 Million charged to an American Express account.
This story reminds us that theft is an everyday risk in the retail automotive industry, and should be treated as such.
Controllers, used car managers, and other managers should be given mandatory vacation days and outside audits should be performed at least once a year. Full the full article, click here.
April 17, 2012
Agghh, anyone who owes money for taxes knows what today is…
“The avoidance of taxes is the only intellectual pursuit that carries any reward” – John Maynard Keynes
Happy Tax Day everyone!!
April 5, 2012
Today in CarMax News, the company announces their 4th quarter results for 2012.
March 28, 2012
America’s Car Mart (CRMT) announced the opening of their 113th dealership today. This one is in Tupelo MS, making it the company’s second Mississippi dealership. It is also the seventh dealership opened by Car Mart since the beginning of this fiscal year.
March 24, 2012
Today in AutoNation News, the company announces a major stock buyback program.
March 19, 2012
Given some of the recent press concerning the resurgence in the retail automotive industry, our writer-at-large takes a look at the complete economic impact of local used car dealerships.
March 14, 2012
Bloomberg had an excellent article today about the resurgence of the local car dealership.
Some highlights from the article:
Employment at vehicle and parts dealers has increased for the past 19 consecutive months.
According to NADA, car dealers’ average pretax profit was $279.685 in 2008.
For the entire article, click here.
March 5, 2012
U.S. Auto Sales Are At a 4 Year High!
February’s sales numbers have been tallied and the US Auto market is the strongest it has been since 2008. Vehicle sales were up an astounding 15.7% even though gasoline prices have significantly increased, creating headwinds for vehicle sales.
Most of the automakers saw double digit growth in February.
Ford’s sales were up 14%. They sold a total of 179,119 vehicles in February. Notably, this was a great month for the Ford Focus. This easy on gas vehicle had its best February in 12 years.
Toyota’s sales were up 12% for a total of 159,423 vehicles. Also, similar to Ford, Toyota’s big star of the month was also a fuel efficient car- the Yaris.
Honda’s sales were up 7.8% for a total of 110, 157 vehicles.
Nissan’s sales were up 15.5% for a total of 106,731 vehicles.
February 16, 2012
In General Motors Analysis, GM is officially back from the dead, and better than ever. Today, the domestic giant posted it’s largest profit ever.
February 9, 2012
Apparently Clint Eastwood’s Chrysler ad sparked a good deal of controversy since its SuperBowl appearance. Critics and political pundits have declared the commercial “too political” and most have stated the commercial is purely an advertisement for the Obama administration. However, both statements are complete rubbish.
Clint Eastwood has stated that the ad is non political. Chrysler has stated the ad is non political. But, I think a Chrysler dealer from Valdosta GA, Cass Burch, said it best in the Wall St Journal today when he stated “To say it was a political favor is bull hockey. That comment makes me want to fistfight somebody. Here I was overwhelmed with emotion and pride…It is bush league for them to take something that is so heroic and so patriotic about our company and to make it political.”
Personally, I thought the ad was powerful and struck a positive chord with Americans. I stand with Eastwood and Cass Burch.
February 6, 2012
The New York Giants won last night’s game, but Chrysler won the commercial SuperBowl.
For the second year in a row (yes, I liked the eminem ad also) Chrysler displays an amazing ad for the Super Bowl. It appears that the “Imported From Detroit” campaign is turning out to be very successful.
For the Clint Eastwood “Halftime in America” ad, click here.
Feb 1, 2012
January Auto Sales
January new car numbers are out, and they are good. No, they are great.
Everyone knows January is normally a slow month, but not this January. In fact, it was the best month for car sales since August 2009, when the “cash for Clunkers” program was in full swing. Sales were up almost 12% and if the rate can remain constant, many analysts have commented that we could once again see 14 million sales this year. Analysts are tripping over themselves trying to explain this lofty sales number. Is it because the average age of America’s cars is almost 11 years old? Is it because used car pricing has remained high due to the used car shortage? Is it because gas prices have remained stable? I say… yes, yes,and yes. I would also add that most of the country experienced extremely warm weather for most of January.
Some other January highlights include:
Toyota sales rose 7.5 percent to 124,540 in January.
Nissan sales in the United States rose 10.4 percent to 79,313.
Toyota’s sales were up 7.5%.
Nissan’s sales were up 10%
Ford’s sales were up 7.4%
But the real winner in January was Chrysler. Chrysler’s U.S. auto sales were up a whopping 44%.
Jan 15, 2012
Happy New Year!!!
New Years is a wonderful time for a person to reflect on their past and to refocus one’s energy on their future endeavors.
The New Year is also a great time to make a detailed plan to become a better used car professional. Whether you are a used car manager, wholesaler, or salesman, if you dedicate yourself to: being better, having a plan that you actively follow, working hard, and holding yourself responsible for living up to your yearly expectations, chances are great that you will in fact be better in 2012 than you were in 2011. This holds true if you are a saleswoman, used car manager, wholesaler, or lot attendant.
In 2012, The Used Car Voice will continue providing information that is vital to members of the used car industry.
Wishing you a healthy and prosperous 2012.
December 19, 2011
R.I.P. SAAB. Today is a sad day for Saab enthusiasts. The Swedish automaker filed for bankruptcy today. We would like to lend our sympathies to those employeed by Saab and also to the owners of Saabs, whose parts are going to be even more difficult to find. For further news on the Saab bankruptcy, click here.
December 9, 2011
Today in Toyota Analysis, the Japanese automaker says good bye to it’s title as Largest Automaker in the World.
December 2, 2011
It has been a big week for recalls. Honda is currently recalling 304,000 vehicles world wide for potential airbag problems. This recall is a mere extension of the ongoing recall Honda has been dealing with since 2008. For the complete rundown on Honda’s recalls, click here.
November 11, 2011
Today in Toyota Analysis, the company announces a return to “normal” manufacturing levels.
October 27, 2011
Today in Chrysler News, the Detroit automaker announces a profit for the third quarter.
October 20, 2011
Today in AutoNation News , the company announces an excellent third quarter.
August 30, 2011
Good news today for subprime car buyers. According to Reuters, car loans for subprime borrowers increased to 40.8 percent from 37.2 percent a year ago. Although the industry will probably never reach the high water mark that was set for subprime F&I penetration back in 2007, a whopping 46.2 percent, it is a step in the right direction for those of us in the subprime business.
This latest news also includes the fact that delinquencies are down from last year. This would indicate a trend of better underwriting within the industry.
For the full Reuters article, click here.
August 29, 2011
After a recall filled 2010 and a 2011 that has included massive earthquakes, tsunamis, and nuclear disasters, Toyota can breath a small sigh of relief today as Moody’s confirmed their Aa3 rating with a “stable” outlook. The company’s credit rating has been in a downward spiral since 2010, and thus it’s borrowing costs have escalated. This reaffirmation by Moody’s puts a halt to that trend, and is good news for those at Toyota.
August 12, 2011
Today in AutoNation News, the retailer releases their July sales numbers.
July 8, 2011
Reuters is reporting that the average supply for new full-size pickups is currently 99 days. According to the article, industry analysts and executives like to see this number at 80 days. General Motors is currently the worst offender with the highest supply of new full-size pick up trucks.
This industry wide oversupply in full-size trucks illustrates the continued weakness in the construction industry. It also reinforces the American consumer’s sensitivity to $4 gasoline. Hopefully the high incentives currently being offered on these vehicles will help reduce the supply.
We understand how difficult it is to project accurate sales numbers 6-9 months in advance. This is true at a dealership level, a regional level, and corporate wide level. Let’s hope that the people in charge of full size truck production and purchasing have taken the current supply and continuing weakness in the US housing sector into account and have adjusted their sourcing appropriately. If not, dealerships are going to be bursting with full-size truck inventory by the fall. For the full Reuters article, click here.
July 7, 2011
General Motors announces a recall. For more information, see General Motors Analysis.
July 5, 2011
AutoNation’s June numbers are released today in AutoNation News
July 1, 2011
June auto data has been released from Autodata. US light vehicles sales are up 7% from last year and down .8% from May.
June 17, 2011
General Motors announces the starting price for their new 2012 Chevy Sonic at $14, 495. The compact Sonic is part of GM’s new fuel efficient strategy. The sonic gets over 40 mpg for highway miles. For more, see our General Motors Analysis page.
June 14, 2011
Group 1 announced today that they have purchased two new dealerships. Both dealerships are located in El Paso Texas. Goup 1 purchased Shamaley Ford and Shamely Buick-GMC. This doubles Group 1’s El Paso’s exposure. Currently they own a BMW/Mini dealership in El Paso.
May 19, 2011
Most people thought it would never happen. However, chrysler announced today that it intends to repay the loans from the American and Candian governments next week. See the Bloomberg article for full details.
May 17, 2011
Penske Automotive Group announced satisfactory first quarter earnings today. For more, visit our Penske Automotive Group News page
Jan 17, 2011
Today in carmax news Carmax publishes their 2011 fuel efficiency tips.
Jan 4, 2011
New car manufacturers reported their December 2010 sales numbers today. The domestic manufacturers continue performing well.
Chrysler- up 16.4%
GM- up 16%
Ford- up 6.7%
Toyota – down 5.5%
Jan 1, 2011
The dawn of a new decade finds the used car industry looking fairly healthy. The industry enters 2011 with much more optimism than in previous years. We wish you and your family a Happy and Successful New Year.
Oct 26, 2010
Consumer Reports has spoken and despite recalling over 10,000,000 vehicles this year, Toyota still ranks very high in reliability. For the complete article, click here.
Oct 20, 2010
Today in General Motors analysis, GM does something nice for their dealer base.
Oct 1, 2010
Good news, once again, for domestic dealerships as GM, Ford, and Chrysler announce higher sales for the month of September. Although it is still difficult to make meaningful yearly comparisons, this is a very positive sign for domestic dealerships. Bloomberg covers the specific numbers here.
Sept 27, 2010
Today in Ford Analysis, Ford’s CEO Mulally discusses limiting Ford’s model line-up in order to improve quality. It appears that Mulally is continuing to make decisions that keep Ford’s quality as his highest priority.
Sept 24, 2010
Here at The Used Car Voice, we try to focus most of our energy on issues that affect dealerships. We only cover issues at the manufacturing level that significantly impact industry professionals at the dealership level. Recently, a local news reporter from Detroit, recorded some disturbing images of Chrysler workers on their lunch break. The video is actually quite shocking and disappointing. Once again, problems at the manufacturing level will do economic harm to employees at Chrysler’s dealership level. This video is getting serious airplay on the net and will probably be nationwide by the weekend. Click Here for the Chrysler Auto Workers drinking and partying at lunch video. If this is happening at one plant, what are the chances it is happening at many plants? Get your house in order Chrysler/Fiat.
Sept 17, 2010
After only 3 years in development, we have several winners for the $10 Million Automotive X Prize. The challenge was to produce a vehicle that gets over 100 mpg. These companies did in 3 years what all of our car manufacturers have been unable to do. See CNBC for the full story.
Sept 13, 2010
Tomorrow is a big day for Chrysler dealers. Over 1,700 Chrysler dealers will get a first glimpse of the new models that will be hitting their showrooms this fall. For many of them, it will be their first look at models that have been redesigned by Fiat. For the past several years, it has been challenging being a Chrysler dealer. Let’s hope these new models are outstanding and capable of driving showroom traffic.
Aug 12, 2010
Today in General Motors Analysis, General Motors names a new CEO.
Aug 2, 2010
In Ford Analysis, more good news for Ford. Today, S&P upgraded Ford’s credit rating.
June 24, 2010
A Tale of Two Companies
Yesterday, The Used Car Voice brought your attention to Ford’s outstanding second quarter. We also mentioned that GM agreed to purchase subprime lender Americredit. At the time, I thought it could be seen as a positive for the subprime markets. However, now it appears that it is just another poor decision by GM. Yesterday afternoon, Fitch downgraded Americredit’s debt rating. WOWSERS!! In other words, GM just made an offer on a subprime portfolio that Fitch thinks is almost junk status. Keep in mind, Fitch and the other rating agencies were completely off base with their assessments of mortgage backed assets in this country. The rating agencies proved themselves incompetent at best, and nearly destroyed the world’s economy.
How bad was GM’s due diligence on this Americredit deal? The American tax payer is still on the hook for GM, should we also be on the hook for a subprime portfolio that is almost junk as well?
June 23, 2010
Today in Ford Analysis, Ford reports their second quarter results. It looks like another blowout quarter in a row for Ford.
In another story related to our domestic manufacturers. Yesterday, GM announced they were purchasing supprime giant Americredit for $3.5 Billion. Last I checked, GM still owes the government (taxpayers) around $12 Billion. After the announcement, analysts were tripping over themselves to announce this move as “great” or “terrible”. We at The Used Car Voice feel that the aquisition of Americredit is probably a decent move for GM’s future, although there are definitely better players in the subprime world than Americredit. However, without the bailout from the taxpayer, GM would have ZERO future. There are currently 350 million involuntary stock holders of GM (tax payers) we would like our money back and THEN GM is welcome to buy whichever company they wish.
July 22, 2010
Today in AutoNation News, AutoNation announnces their 2nd quarter results. As usual, we will cover the AutoNation conference call in great depth (hopefully over the weekend). But, on the surface, it looks like a home run.
July 19, 2010
Have you heard? There is a used car shortage. Although the Used Car Voice has been talking about the used car shortage for years, it is finally getting some play on the national business networks. CNBC.com, ran a nice article this morning about the used car shortage and how it relates to upcoming earnings of the publicly traded automotive retail companies (AutoNation, CarMax, etc…). They see the used car shortage as a positive for the used car dealerships, a view that we have been publicly airing for some time. For example, in May we said this. Well, Kudos to CNBC for getting the story. The article is definitely worth a read. Click here for CNBC article.
July 13, 2010
In Chrysler News, arbitrators will rule next week on the final cases for those dealerships that petitioned Chrysler and General Motors to try and remain in business. The arbitrators have reviewed nearly 1,600 cases. We at The Used Car Voice wish the best outcomes for all dealerships involved. However, it is likely that many dealerships will not be reinstated. We also feel sympathetic to the arbitrators that are facing 1,600 difficult choices. Hopefully, these announcements will help close one of the ugliest chapters in Retail Automotive history.
July 8, 2010
Today in Chrysler News, the company announces they will make their customer’s first two payments for most new Chryslers bought in July. Obviously, this is an attempt to drive sales after a weak June for Chrysler.
June, 29, 2010
The electric car maker Tesla had quite a successful IPO today. Tesla sold 13.3 million shares for $17 apiece, raising just over $226 million. The company originally planned to price 11 million shares between $14 to $16 per share. Higher demand for the shares resulted in the higher IPO price. Further, this comes on a day when the major indices have been down as much as 2%. The company plans on using their newly raised funds to further the development and production of their S model, a $50,000, 4 dr, electric sedan. Tesla trades on the Nasdaq under the symbol, TSLA.
June 23, 2010
Once again, Carmax is stealing the headlines in the automotive retailing industry. In CarMax News, they announced their first quarter results today and the numbers were excellent.
June, 22, 2010
Good news was announced today for Carmax. Carmax (KMX) is going to replace XTO Energy in the S&P 500.
Also, yesterday marked the first day of summer. Today marks the first auction day to start complaining about how hot it is at the auctions. There is nothing quite as hot as working an auction in the summertime, standing on blacktop, surrounded by hundreds of motors, with virtually no shade. Enjoy the summer everyone!!
Have a good week in the lanes.
June 17, 2010
In CarMax News, CarMax opens their first store in the Cincinnati area.
June, 15, 2010
While most used car market prognosticaters focus solely on day to day auction activities and prices, we have been keenly focued on Europe. While that might seem strange to many in the used car industry, we believe Europe is the “canary in the coal mine” when it comes to the world’s credit. Unfortunately, since this credit crisis began, worldwide credit has been determined by the bank, company, or country (Citi, Fannie, AIG, etc…) with the largest credit problem. Greece currently holds the crown for “biggest credit default risk”, with Spain, Portugal, Italy, and BP following close behind. Yesterday, Moody’s cut Greece’s credit rating to their “junk” status. Moody’s, a rating’s company, has been late on every single credit announcement since the credit crisis began, and they continue their streak of tardiness with the Greece announcement.
As go the credit markets in Europe, so goes the credit supplied to the Used Car Industry in the United States.
Further, the European Union is entering an extremely slow period of economic growth. First evidence of that can be found this morning. According to the ACEA, European passenger car registrations fell 9% in the month of May. – OUCH!!
June 7, 2010
Today in Chrysler News, the company announces the recall of 600,000 units. Most of these recalls impact the electrical door wiring of the Town & Country and Caravans as well as the Wrangler’s brake pads. In other words, your doors could ignite on fire and your jeep might not stop.
As a Dealer professional, recalls are a double edged sword. Small recalls are great because they bring in the service customers and allow for cross selling and up selling. However, large recalls (ask Toyota Dealers) can severely harm your brand and your unit sales.
Recently, at The Used Car Voice, we have praised the newest redesigns of Chrysler’s product line and the actions of Fiat and their CEO Sergio Marchionne. As a tax payer and therefore a stockholder in Chrysler, we know that Mr Marchionne inherited a company in trouble, when Fiat absorbed Chrysler. However, it is time that Chrysler and Fiat get their manufacturing house in order. Incompetence at the executive level (Nardelli, etc) of Chrysler has cost their dealer network for decades. The engineering laziness and the sloppy manufacturing caused Chrysler to fail as a viable company. This has caused enormous suffering for the thousands of Chrysler dealership employees (who kept their job) across this country, and it is time for the mistakes at the executive and manufacturing level to end.
Toyota has been fighting for their life recently due to severe and massive recalls. Chrysler… you are NOT Toyota. Your brand is not in the same league as Toyota’s brand. You can NOT withstand the same bad press that has recently plagued Toyota. Mr Marchionne, it is time to fix the manufacturing problems at Chrysler. You deliver a great speech and appear to be an effective communicator. However, you are the head of a manufacturing company, and at the end of the day, your job is to manufacture a product that sells and does not get recalled. While this recall was probably due to mistakes of the old Chrysler regime, the next massive recall will be the complete responsibility of Mr. Marchionne and Fiat’s executive team.
June 3, 2010
In AutoNation News, the company just released their May New Car sales data.
June 1, 2010
Whenever there is a Monday holiday, the Tuesday auctions are usually very difficult. There is typically a shortage of both vehicles and buyers on these days. For me, these Tuesdays never resulted in a good volume day, but I would usually find 1 or 2 with a bigger than normal margin. Good luck to both buyers and sellers today.
May 31, 2010
Today, we as a nation celebrate Memorial Day. Spend some time today thinking about the ultimate sacrifice that many of our citizens have made for our country. If you able, do something nice for a veteran. The recession has hit everyone hard, including most non profit organizations. This means that most of the organizations that support our wounded veterans have been woefully underfunded, at a time when they are most needed.
The Used Car Voice is meant to be a place to inform people about the used car industry. Our community is designed for Today’s Used Car Professional. Our first priority will always be the used car industry. We are concerned with the economic health and the structure of the used car industry, as well as the professionals who comprise the industry. Many of our Used Car Managers and Professionals are veterans of military service, and we here at The Used Car Voice want to send our most sincere thanks to them and the rest of our veterans.
A portion of every product sold on The Used Car Voice has been donated to the Disabled American Veteran’s fund (DAV) since the day we started, and we will continue to do so. The DAV is a wonderful organization and deserves your support. Please support your veteran organizations.
May 28, 2010
In Ford Analysis, the elimination of the Mercury brand is discussed.
May 26, 2010
The Financial Times is reporting that the French car maker Peugeot is shaking up their Senior Management in an effort to capture more of the Chinese market.
May 25, 2010
In Ford Analysis, Ford is bringing jobs back to the US.
May 24, 2010
Both CarMax (KMX) and Fiat (F.MI)are analyzed through the eyes of the European Debt Crisis and the used car shortage.
May 22, 2010
When Fiat purchased Chrysler, they bought a company and a brand in crisis. Needless to say, the numerous mistakes made at the manufacturing level caused significant harm to Chrysler dealerships across this country. Many were forced to close their doors. The dealerships that stayed open have struggled with the recession and an obsolete pruduct line. However, Fiat’s CEO Sergio Marchionne is determined to turn Chrysler around. In Chrysler News we have video of Chrysler’s newly designed Jeep Grand Cherokee.
May 21, 2010
On our Toyota Analysis page, Toyota announces a partnership with Tesla.
May 20, 2010
In Toyota Analysis, another recall for Toyota. It is only a minor recall involving vehicles in Japan.
In AutoNation News, Eddie Lampert reduces his exposure.
May 19, 2010
Used Car Managers should be increasing their Car Profit and keep an eye on Europe
May 17, 2010
In Toyota Analysis , Toyota actually turned a profit, despite the massive recalls.
May 4, 2010
In CarMax News – The Salary of their top executive is released and Warren Buffett reduces his stake in the company
April 13, 2010
In CarMax News, CarMax releases their 4th Quarter results.
Here are some things to consider when setting up a home office.
More and more Americans are establishing home offices, including most wholesalers , used car manager and other Used Car Professionals. There are important features that every home office should have. Most importantly, it should be private and as “separate” from the rest of the home as possible. In other words, when you are in your home office, the rest of the family members living in the home should give you the privacy needed to do your job. Most people who have achieved success in balancing their work and family life while working from home have created a separation that allows them to focus on their work while they are in their office, and focus on their family while they are in the rest of their home.
If your job requires phone work, use a landline. I know, I know. Landlines are so “old school”. Everyone loves their cell phone or smart phone, including me, I love my smart phone. I carry it with me wherever I go. I also conduct a lot of business on my cell phone. However, I still have a landline in my home office. In fact, many telecommuting companies REQUIRE a landline. The reason for this is simple, when your business reputation is on the line; no one wants a dropped call. Cell phones are great, but they still drop calls at a much higher percentage than landlines.
I have seen home offices that were extremely expensive to set-up, and I have seen very nice and immensely functional home offices that were created with virtually no money. Your office will obviously depend on your needs and your budget.
If you are short on funds, there are several things you can do to create a working environment that is right for you. For example, if you need furniture, buy used instead of new. Office furniture is very similar to exercise equipment. People buy these things; use them for a short period of time, then start hanging their laundry on them. Eventually people discard these items. Further, since a majority of new startups go out of business within the first year, there is always a large supply of used office furniture. Try looking in: Craigslist, Goodwill, or even yard sales. You will be amazed at the quantity of used office furniture that is available.
Lastly, and this might seem obvious, but, don’t purchase something until you have a need for it. When setting up offices, people have a tendency to rush out and buy things they “might” need. Some of these items, like a copier machine, can be rather expensive, so wait until you have an actual need before purchasing office equipment.
A home office will also count as a large tax deduction. The size of your tax reduction will depend on the size of your home office. A 1,000 square foot office will receive more of a refund than a 50 square foot office. However, there are several home office requirements that must be met in order for a home office to qualify for this tax break. One of the most important features is that the space designated as a home office must be used exclusively and regularly as the principle place of business, or it has to be a place used by clients, patients, or customers.
It has also been widely reported that claiming a home office deduction has always been a “red flag” for IRS audits. I think this has changed in recent years with more and more Americans working out of their house.
If you have further questions regarding the home office tax deduction you should consult your accountant.
One thing is for sure about Jack Welch- he isn’t shy about sharing his opinion. The former CEO of GE was on CNBC’s Squawk on the Street this morning sharing his opinion about several topics, including his assessment of Toyota’s crisis management.
Click Here to see the 5 minute clip.
“A car for every purse and purpose” Alfred P Sloan
GM is aggressively trying to distance their Cadillac brand from the rest of General Motors.
Bloomberg reported today that “Cadillac is erasing the GM name from its marketing and dealerships, changing e-mail addresses to @cadillac.com from @gm.com and exiting companywide promotions such as the Red Tag Event, said Nick Twork, a spokesman. The separation strategy was “absolutely” driven by GM’s restructuring, he said.”
“Cadillac, which has really turned itself around with new levels of quality and exemplary products, doesn’t want to be associated with something that will drag it down,” said John Grace, president of marketing consultant BrandTaxi LLC in Stamford, Connecticut. “With GM’s bankruptcy comes lower credibility in the ability to build quality products.”
John Grace correctly stated that Cadillac doesn’t want to be associated with something that will “drag it down”. However, the opposite is also true. Apparently, GM doesn’t want to be associated with something that will bring it up. I would have NO problem with this strategy, if the American tax payer was only on the hook for Cadillac.
In the short term, this appears to be a good decision, but I fear, in the long run, it will drastically impair GM’s overall recovery. As a GM stock holder (taxpayer), I am concerned about this decision. If GM wants to sell Cadillac and repay some of our (taxpayer) money back to us, that is one thing, but distancing the only part of GM that is doing well from GM doesn’t sound like the best thing for GM stockholders. In other words, American taxpayers didn’t bail out Cadillac, we bailed out GM.
The Bloomberg article quotes several dealers whose business suffered because of their relationship to GM during the bankruptcy process. That is unfortunate, especially since our MAIN concern at UsedCarVoice is ALWAYS the dealer. However, it is the same argument Toyota dealers can now make, Chrysler dealers can make, and Ford dealers could have made during the Firestone recall.
My question for GM’s senior management is this, what happens the next time gas hits $4.50?
Every time gas gets that high, every manufacturer moves their advertising to promote the products with superior gas mileage. In GMs case, this would include models in the Chevrolet line. Will Cadillac dealers still want as much distance from Chevy as possible when the next gas crunch comes? I recall several gas crunches being extremely bad for Cadillac sales.
What if other companies, segmented their products and divisions in the same manner? Why isn’t the I Phone a separate division from the rest of Apple? Why hasn’t McDonalds broken off their new coffee line into stand alone stores? Why isn’t Lipitor a separate company from Pfizer? The reason is this, great products and brands HELP the overall corporation. Granted, there are situations where separating the brands is a good idea, but I don’t believe it is appropriate in this case.
General Motors seems to think that if they sever ties with Cadillac, the American consumer who has followed the General Motors Company for over a Century will suddenly forget that Cadillac is part of GM. Apparently, the American consumer, tax payer, and thus GM stock holder will also forget that GM had to go into bankruptcy. We will simply forget the news stories that ran day after day for over 6 months. We will forget the famous day when all of the domestic CEO’s were summoned to Congress and flew to D.C. in their private jets. Cadillac and GM have been intertwined for 101 years. Changing an email address isn’t going to change that perception in any educated consumer’s mind.
Bloomberg reported, “Cadillac is critical to GM’s turnaround,” said Jeff Schuster, a J.D. Power analyst in Troy, Michigan. “Certainly from a profitability standpoint, it’s important. But if you can raise the image of Cadillac, that will also buttress the GM brand.” I agree with Jeff. But, this effect will be diminished the more GM tries to separate from Cadillac.
For the entire Bloomberg article click here.
Today is a good day for the used car industry and used car managers. Chrysler announced today that it would reinstate 50 dealerships. These franchises were part of the 800 dealerships that Chrysler cut ties with during their bankruptcy procedures.
“The 50 dealers are in locations that offer customer service benefits and will have limited adverse impact on the dealers within our current network,” Chrysler said in a statement. This sounds like good news for these 50 dealerships, as well as Chrysler’s current dealer newtork, and the consumer.
Does this tell us anything about the current strenght of the domestic car market? Does this tell us anything about the strenght of Chrysler?
50 seems like a high number, until you consider GM reinstated 600 dealers this month. For the full GM story, click here. Our concern at The Used Car Voice is always with the dealer. From that perspective, this is a good thing for 50 dealerships and their employees. We send these 50 dealerships a congratulations and wish them success in the future.
With the recent turmoil facing Toyota, the market pundits have been guessing which manufacturer will reap the benefits of Toyota’s blunders. That manufacturer appears to be Ford(F). Ford has been on a roll ever since the other two domestics declared bankruptcy. CEO Mulally appears to have ushered in a new era at Ford. An era marked by higher quality standards and much less leverage on the Balance Sheet. His efforts have been applauded by Wall Street. Ford’s share price has steadily moved up since the S&P’s March lows.
With yesterday’s release of February’s sales numbers, Ford has even more to celebrate. For the first time since 1998, Ford beat GM in sales. According to Bloomberg, “Ford reported a 43 percent increase in sales to 142,285 in February. GM reported sales of 141,951 units, a 12 percent gain.” Industry wide, February sales ran at a seasonally adjusted annual rate of 10.4 million, according to Autodata.
It is still too early to call one month’s results a trend. However, all news out of Ford seems to be positive, while all news out of GM (Saab, Hummer, etc) appears to be negative. Due to the enormous size of these companies, it is very difficult to change the climate and direction of the company quickly. It is the equivalent of turning a speed boat versus turning the Titanic. Therefore, these trends tend to play out over a long period of time. With this in mind I continue to look for good things from Mr Mulally and Ford.
This year’s NADA convention provided an opportunity for the new management of Chrysler to speak directly to their dealer base and the rest of the used car industry. The management team, implemented by Fiat, laid out their plans for the upcoming year.
According to the Associated Press “Chrysler plans to have 16 new or significantly redone models by the end of this year. The company has high hopes for a new lighter, and more efficient, Jeep Grand Cherokee that is coming around June. A redone Chrysler 300 and Charger, the new Fiat 500 minicar and a new Dodge sport utility vehicle are expected later in the year.”
The new Chrysler team also projected their 2010 sales at “just under 1.2 million.” The company also stated that with their cash on hand and sales of “just under 1.2 million”, they will be able to turn a profit for 2010.
All of these things are very positive for Chrysler/Fiat and the Chrysler dealer base. But…
Several dealers are still very concerned about their sales in the near future. It will take some time for the new Chrysler/Fiat models to appear, which leaves dealers with inventory that is less than desirable. Chrysler dealerships will continue to struggle throughout 2010. They will continue to cut costs and make sacrifices, in order to buy time until the new models arrive.
Fiat/Chrysler will obviously be instrumental with helping their dealerships over the course of the next year. The tone set by the manufacturer’s advertising presence will be crucial during this transitional time. However, according to some Chrysler dealers interviewed at NADA, they are skeptical of the recent ad campaigns that deal with brand identity.
I agree with these dealers. There is a time to build brand identity. Nine months before you replace most of your models with completely different models, is not the right time. This tells the customer that “we love our designs soooooo much, we are completely changing them.” The sentiment is correct, just a bit early.
Right now, Chrysler dealerships need help selling the models they have. Now is the time to be pushing price. Let’s face it, Chrysler dealers aren’t going to be able to hold much margin on their older models anyway. Chrysler needs to embrace this time of “out with the old, in with the new.” Every piece of advertising that comes out of Fiat/Chrysler needs to convey that Americans will never get a better deal on a Chrysler than they will right now. Chrysler dealerships need to clear their lots and Americans have become very price sensitive during our ongoing recession. The timing has never been better for a price leader campaign.
Chrysler dealerships need assistance in selling more service and more used cars. To help their dealer base, Fiat/Chrysler should focus some of their advertising dollars toward these initiatives. For example, advertising that discusses “certified used vehicles” should help drive used traffic.
It seems that Chrysler is on a positive track. It also appears that 2010 is going to be as challenging as 2009 and 2008 for Chrysler dealerships. These are franchises that have continuously suffered due to extremely poor business decisions made at the manufacturing level, especially during the Cerberus years. If this truly is a new Chrysler, with truly different thinking and possibilities, then it is time for the new management of Fiat/Chrysler to do whatever is necessary to help their dealer base in 2010.
The dealers in the room at NADA feel confident that the new management team at Fiat/Chrysler is currently on the right track. These dealers are on the front line, and their positivity speaks volumes to me. For their sake, I hope they are correct.
Oh, What a Feeling! Toyota!
“Things are going to get a lot worse, before they get worse.”- Lily Tomlin
Toyota keeps getting pummeled. I haven’t seen a beating this bad since Cooney vs. Holmes. The latest to pile on is U.S. Transportation Secretary Ray LaHood. Secretary Hood said today at a House Appropriations committee that drivers of vehicles that are affected by the Toyota recall should “Stop driving it and take it to a Toyota dealer.”
The bad news continues for Toyota. Earlier this week, the company stated that their “sticky” accelerator issue would be fixed by having dealerships install shims in the accelerator. However, LaHood stated today that the US government is investigating to see if the cause of the problem is in fact the electronic throttle system. According to Bloomberg news, the electronic throttle system is the cause of at least 7 law suits.
It is a BAD week to be a Toyota stock holder.
Toyota was trading around $95 a share as recently as January 19th. Today’s intraday low was $71.90. Granted, the overall market place has also experienced higher volatility and lower prices in the past 2 weeks, but Toyota has been selling off faster than the overall market. Toyota had also traded down on very heavy volume days.
What does all of this mean for Toyota?
In the short run, it means plants will be continue to be temporarily shut down and Toyota dealerships will suffer a drop in sales until the accelerator issue can be resolved. In the long run, Toyota’s recovery from this issue will depend on how much tarnish this incident has laid upon Toyota’s pristine image? However, it is still too early in the process of events to determine that.
“Those who cannot learn from history are doomed to repeat it.”- George Santayana (philosopher)
General Motors announced yesterday that their interim CEO Ed Whitacre would become their permanent CEO. Whitacre is the former CEO of AT&T and was appointed Chairman of General Motors when the company emerged from their government sponsored bankruptcy. Whitacre has been interim CEO since replacing Fritz (we barely knew you) Henderson after only an 8 month tenure at the helm of GM. According to CNBC, “Whitacre has said Chris Liddell, who joined GM as Chief Financial Officer from Microsoft, is a leading candidate to succeed him.”
This continues a long tradition of hiring non-car executives (remember Bob Nardelli) to the top spot of our domestic car manufacturers. I am concerned about this appointment helping to continue an even larger trend, which is, the downward slide of our domestic manufacturers (excluding Ford’s recent good fortunes).
I am certain that being the CEO of a company the size of General Motors requires a distinctive skill set. Additionally, GM currently finds itself highly indebted to the American tax payer, a situation that would make the job of any CEO more difficult. The CEO of General Motors has an enormously difficult job that requires expertise across several business functions. Most of these activities are probably identical to Mr Whitacre and Mr Liddell’s previous positions at AT&T and Microsoft. These would include dealing with the press, dealing with Wall Street, deciding on a bond offering, etc… However, there are peculiarities in the automotive industry, as there is in every industry; that require someone who has at least a tiny bit of experience in the industry.
I am certain that Mr Whitacre and Mr Liddell are exemplary executives, trained in the latest management techniques and educated in the finest schools. But each industry goes through ebbs and flows that are unique. The executives who have operated in an industry during different economic stages develop historical knowledge that they can then apply to future situations, which should lead to more informed and hopefully better decisions. Mr Whitacre and Mr Liddell are obviously lacking any of that knowledge.
At The Used Car Voice, we try to think positively. With that in mind, this could be an excellent decision for General Motors. As a realist, I have my doubts about the success of the new GM. However, I am an American tax payer, which also makes me an extremely reluctant stock holder of General Motors. Since I am a stock holder, I can only say… Good Luck Mr Whitacre, I wish you all the success in the world!!