CBT automotive newscast: March 11, 2022

Inside Automotive:

What are today’s auto dealers most concerned with? VADA Pres. Don Hall weighs in.
On this edition of Inside Automotive, we’re pleased to welcome back Don Hall, President and CEO of the Virginia Automobile Dealers Association, to discuss a few hot issues facing auto dealers right now. Today, Hall and anchor Jim Fitzpatrick tackle the current state of vehicle inventory, Ford’s recent ICE/EV announcement, and why some states are working hard to block industry disruptors. Watch the complete segment here.

Headlines:

BMW is recalling over 900,000 U.S. vehicles due to engine fire concerns. This is the third fire-related recall for the automaker since 2017. This latest recall covers several vehicle models built between 2006 and 2013, including some 1 series, 3 series, 5 series, and other models, Reuters reports. Some of the vehicles previously repaired under prior recalls will need to have further work done. However, due to supply chain shortages, customers will likely have to wait until mid-2022 for a resolution.

Cox Automotive has released the findings from its latest Dealer Sentiment Index. Compared to Q1 2021, this quarter’s market outlook index rose modestly and the overall profit index remains well above pre-pandemic levels. Additionally, car dealers are feeling less pressure to lower their prices. However, they are also still facing challenges with staff turnover and inventory management.

Auto dealer M&A activity is continuing its feverish pace. Over the past week, Phoenix-based Earnhardt Auto Centers sold two Las Vegas stores to Jerry Seiner dealerships, based in Utah. Group 1 Automotive also announced its intentions to buy Charles Maund Toyota for $435 million dollars in Austin, Texas. Ed Morse Automotive Group also made moves and acquired four dealerships in Iowa. Lastly, Asbury Automotive Group sold its store known formerly as Plaza Lexus in Creve Coeur, Missouri, to the Gurley Leep Automotive Family.

News & Opinion:

The auto industry is changing — so are technicians
Most dealers are experiencing relief from the past couple of years’ difficulties. So, admittedly, there’ll be no argument or complaint about the increased inventory and sales. But a new challenge of finding service technicians is becoming more prominent than ever. Dealerships have historically kept technicians on an hourly pay scale and haven’t been concerned with departmental promotions. Some of that had to do with a glut of service techs—supply and demand determining value. However, hiring hourly techs and not giving them a pathway to promotion is coming back on dealerships. Read More

4 simple tips to improve your dealership’s reconditioning process
How long does it take your dealership to recondition a used vehicle? If you are one of the top performers, the answer would be 24 hours or less. Does it surprise you to know that some dealerships require a week or longer for reconditioning? If you are one of these dealers, you need to streamline the process for maximum profitability. According to a Cox Automotive Report, you want to retail a minimum of 55% of your inventory within 30 days of acquisition to ensure maximum profitability. The only way to do this is to shorten the reconditioning process. Read more