Over the past few years, the retail auto industry has been navigating through some of its most challenging yet transformative times. On today’s Inside Automotive episode, we’ll catch up with Ernie Norcross, the Owner and Dealer Principal of Volvo Cars Memphis and Norcross Mazda of Memphis, to delve into how his dealerships are addressing today’s business challenges and preparing for the future.
Key Takeaways
1. The automotive industry is returning to fundamental sales practices after the pandemic’s disruptions. Norcross emphasizes the importance of traditional sales techniques, such as value selling, demo drives, and adequate finance and insurance (F&I) presentations. This “back to basics” approach aims to re-engage customers and enhance the overall buying experience.
2. Norcross also observes differing strategies regarding EVs between his two brands. For instance, Volvo is fully committed to EVs, reflecting a robust push towards electric mobility. In contrast, Mazda is adopting a more cautious approach, focusing on consumer readiness and infrastructure challenges. This divergence highlights brands’ varied strategies to address the growing EV market.
3. The used car market has seen shifts post-COVID, with Norcross’s dealerships adapting by hiring a dedicated acquisition specialist. This role uses data-driven approaches to manage inventory and enhance the efficiency of car acquisitions. The focus on Certified Pre-Owned (CPO) and used cars is seen as a growth area, leveraging both dealership and OEM resources.
4. Leasing is becoming increasingly important as vehicle prices rise. Norcross notes that leasing provides a flexible option for customers, especially with higher MSRPs and uncertainties around EVs. Although leasing has not yet fully returned to pre-COVID levels, there is a concerted effort to integrate leasing options into every deal, supported by OEM initiatives from brands like Volvo and Mazda.
5. Norcross highlights strong performance in the service department, driven by the increasing longevity of vehicles. Service departments are seeing significant activity, with customers holding onto their cars longer. Additionally, Norcross mentions the potential for mobile service units as a future consideration to meet evolving customer expectations. Looking ahead, he is optimistic about the used car market and the growth of the Mazda business despite ongoing challenges and market fluctuations.
"Dealers need to get back to the basics of selling value, offering demo drives, and focusing on finance and insurance presentations. It’s about re-engaging with customers in a meaningful way as we adapt to the new automotive landscape." – Ernie Norcross.
