Dealer Alex Casebeer is keeping his eye on the prize despite low vehicle inventory

While new vehicle inventory improved slightly in August, supply is still tight, and consumers are on the search for new vehicles outside of their market. However, car dealers like Alex Casebeer, the General Manager and Partner of Capitol Auto Group, who are selling at sticker price, are also armed with a strategy. 

The last time we spoke to Casebeer, his store increased in volume year-over-year and was one of the top Subaru stores in Oregon. Luckily for Capitol Subaru, not much has changed since then. Overall, gross profits are still solid; however, new car volume is about the same. He says the used car side of his business is tough, but they are battling through it. Acquiring used car inventory is a significant struggle, as are the changes in book values which are “all over the board.” Customers still expect high vehicle trade-in values, so the dealership has to help them mitigate their expectations.

New vehicle inventory in Capitol’s case is “not fantastic.” Despite truckloads of deliveries almost daily, the vehicles are all pre-sold. Ground stock is not growing at any of Capitol’s stores, says Casebeer. In fact, Subaru and Toyota, in particular, have told dealers that it will likely take another 12 months to normalize supply somewhat. Toyota also announced it would cut its October production target by nearly 100,000 vehicles.

In terms of pricing, Capitol is still selling its new inventory at MSRP. In some cases, the dealerships can come off MSRP to move units, and the strategy is paying off. Steve Carlisle, the Vice President of Chevrolet, forwarded an email to Capitol from a customer who said that only two dealers in Oregon were selling at or below MSRP. This customer was on many waiting lists for a Bolt and wanted to make Chevrolet aware of his situation. The automaker guaranteed an extra five units to Capitol to help this customer find a Bolt.

Regarding his sales staff, Casebeer says many of them haven’t sold a car before these atypical industry conditions. In fact, a lot of them have only sold pre-orders or deposits. So, Capitol is focusing on “back-to-the-basics selling.” The group has also brought in outside consultants to retrain the staff and get ahead of the curve.

The steady growth in US EV sales and adoption has led many OEMs to rethink how vehicles are retailed. Casebeer says returning to a 100-day supply of cars is not realistic. In his market, Casebeer says that the percentage of EV owners is still very low. Still, they are nonetheless well-prepared to sell EVs. In his opinion, Toyota and Subaru are holding back on EVs because they don’t believe the market is ready to receive them. EV charging infrastructure alone is causing concerns.