How car dealers can gain a competitive edge in the turbulent used car market

Welcome to another edition of Inside Automotive with Jim Fitzpatrick. Car dealerships tackled some major headwinds in 2021 as supply chain shortages put the brakes on new car production. Car dealers have since turned their focus toward used cars and building up inventory in a highly competitive climate. Here to discuss how dealers can gain a competitive edge are Hugh Hathcock, Owner of Velocity Automotive and Jack Hodge, President of James Hodge Auto Group.

At his dealer group, Hodge says the past two years have been all about pivoting. With the current inventory challenges, vehicle acquisition is more difficult and there is an overwhelming rush to market. In light of these challenges, Velocity Automotive’s division of digital retail window stickers has been a game-changer for his dealerships, says Hodge. For example, if a Ford store receives a Nissan trade-in from a consumer, the appraiser might have to rely too much on guesswork if they are not familiar with what equipment is on the vehicle. Having the original window sticker digital attached to every VIN, saves car dealers time, energy, and money.

The same can be said for auction situations. If the used car buyer is not privy to all of the information available for any given vehicle, then they could potentially lose thousands, Hodge explains. One of Hodge’s stores was previously doing about 85% new car sales and 15% used cars. Now, those numbers have flipped. This store now does 95% used car business. Hodge says, that the tools offered by Velocity Automotive have allowed his group to be more nimble and to serve customers better.

Hathcock adds that while the tools available can certainly do a lot. The most successful car dealers also invest in their operational infrastructure and ultimately use the tools to facilitate and improve internal processes. Having all of the necessary information your dealership needs on one intuitive dashboard was Velocity Automotive’s intention from the start.

“All of this integration separates Velocity Engage from our competitors because it’s faster, it’s easier, and people like that,” says Hathcock. “That’s what a good technology should do, make their job easier.”

Reconditioning is also a crucial component car dealers have to consider when optimizing their used car departments. Hodge attests that without proper accountability and a seamless communication channel, the reconditioning timeline and easily go awry. Hathcock adds that given the current state of the industry, car dealers can’t afford to miss any opportunities. Recon Velocity can help dealers track and adjust their levels of urgency to become much stronger.

The best part? Car dealers do not have to commit to any long-term contracts with Velocity platforms. Hathcock explains that car dealers like to go month-to-month, and that’s the way his company has done things from the start. To learn more about Velocity Automotive, be sure to visit VelocityAutomotiveSolutions.com.

Did you enjoy this interview with Hugh Hathcock and Jack Hodge? Please share your thoughts, comments, or questions regarding this topic by submitting a letter to the editor here, or connect with us at newsroom@cbtnews.com.