CBT automotive newscast: February 8, 2021

Today’s Featured Interview:

Buy/sell expert Dave Cantin discusses the current state of industry consolidation and dealership valuations
Automotive M&A transactions have been extremely active even in the throes of a global pandemic. Lithia Motors has made major headlines as it continues to acquire robust dealership groups across the country. Recently, we spoke to 20-year automotive industry veteran Dave Cantin, CEO of Dave Cantin Group, about the growth of Lithia and the overwhelming strength of the buy/sell market. Watch the full segment here.

Top Headlines:

Ford Motor Company ended 2020 with a loss in final quarter sales. For the full year, Ford posted a net loss of $1.3 billion on revenue of $127.1 billion. Company officials said that 2020 wasn’t what they had hoped for, however, they are hopeful for a brighter year in 2021. CEO Jim Farley announced that the company plans to boost its investment in electric vehicles and autonomous technology to $29 billion. Breaking down the numbers, Ford said that $22 billion will go towards advancing EV development and the remaining $7 billion would be dedicated to the company’s AV efforts. Farley says the new investment will be utilized from now until the end of 2025.

Morrie’s Auto Group has purchased six Wisconsin dealerships, expanding its footprint to 20 rooftops. The retailer bought a majority interest in Brenengen Auto Group of West Salem, Wisconsin. The acquisition included several franchise dealerships such as Chevrolet, Chevy-Buick, Chevy-Cadillac, Kia, Ford, and Chrysler-Dodge-Jeep-Ram. According to Morrie’s CEO Lance Iserman, the company will keep the Brenengen family name on the dealerships. Don Brenengen, owner of the dealerships, said in a statement, “the acquisition will create significant growth opportunities for our employees and a superior experience for our customers.”

Used vehicle sales were down in the month of January. According to research conducted by Cox Automotive, January used vehicle sales were down 5% compared to 2019. Estimates show that the January used SAAR was 38.1 million, down from 40.1 million a year ago and flat compared to December’s rate. Analysts believe the used-vehicle market could receive a lift if new vehicle sales continue to be hampered by the industry-wide chip shortage.

Dealers can learn a lot about customers from their fixed-ops department. Many industry leaders say that fixed-ops allows dealers to collect customer data that can then be used to cross-sell other dealership products. CBT’s Chanell Turner, recently wrote an article titled, “Five types of customer data that you should take from fixed ops.” You can read more on that story here.

News & Opinion:

How dealerships and OEMs reimagine the sales process with digital retailing
The traditional dealership sales model has endured for decades, but the past year has forced the auto retail industry to adapt. While digital retailing existed prior to the pandemic, it’s no surprise that it’s been accelerated as a result. As with other economic and industry challenges in history, dealers and OEMs are rising to the challenge and reimagining the sales process. What that looks like is different among the OEMs and largely hinges on dealership engagement. However, an omnichannel commerce process that allows customers to transition between online and in-person interactions seamlessly, whether they start on the OEM site or the dealership, is a focus. It’s one that the Roadster Express Storefront addresses. Read More

Best practices for engaging today’s car shopper: Automation (Part 2)
Everyone is starting to focus on automation. Its potential to save time, increase responses and increase foot traffic is a godsend to marketing programs. However, according to a recent IDC webinar, customer experience beat out data programs, software development capabilities, and workplace transformation on enterprise agendas. In IDC’s recent COVID-19 Impact on IT Spending Survey, 72 percent of C-level executives said that creating empathy with customers at scale is significantly more important than other initiatives. Use automation, but don’t forget the importance and warmth of human interaction. Automation can never replace the warmth of a smile. Read More