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Dealer Defender by Jim Ziegler - January 2012

Through the years every sales meeting begins and ends with those words.

"What time is it?"


Over the years I've seen thousands of sales professionals jump to their feet, at the beginning or end of a sales meeting, clap their hands once, and shout out at the top of their lungs... "It's Show Time!"


Have today's dealerships lost focus and intensity? Has the excitement gone out of the sale and the enthusiasm left the showroom? 


When I ask a sales professional to describe selling a car; do they talk about persuasion and presentation... or, as is more often the case...do they describe a negotiation process of working numbers and grinding out a deal?


No matter what we're being told, it's still a relationship sale; and,  personality and finesse are more desirable skills than mathematics.


December, for most dealers and manufacturers, was a record month... for many the best sales month since 2008. Statistically, December outperformed every other month in 2011 bringing us to an incredibly upbeat close and an optimistic trend going into the new year.


With the exception of Honda, which is still struggling with inventory, (sales are off 20%) every manufacturer has reported year over year increases, most in double digit percentages.


I see the statistics, and, of course, we all study the numbers and percentages, BUT; the truth is you can feel it.


In any given month I speak with virtually hundreds of dealers and as many managers and industry executives in dealerships nationwide. With email, social media, seminars, speeches and blog conversations that number is expanded into the thousands.


Early on, in those first few days of December, it was evident to me that we were going to see something special closing out the year. AND, these were genuine retail sales... cars and trucks moving off of the lots and showroom floors... as opposed to some manufacturer dumping a bunch of fleet units or performing an accounting maneuver at year's end to skew the numbers.


Still on a roll, this trend appears to be continuing into January.


For the most part, dealers are upbeat and increasingly aggressive...going after the market. Which brings us to the other "Show time".


Next week, January 10th-11th, the Show season opens with The Detroit Auto Show

... and this year it's a dogfight as almost every manufacturer is introducing some of the most exciting concept and production cars I've ever seen.  More redesigned, re-engineered and breath-taking new models and technology are debuting at the same time. I cannot remember a show in recent years with this intensity of advance buzz about sizzling product. The timing couldn't be better as the public is returning to the showrooms.


In the retail car business we've always told the manufacturers... if you build great product, we'll sell it. If the manufacturers will continue to bring great product to market, stop meddling in retail (you're not good at it)...restore reasonable profit margin and then just get the hell out of the way... we'll amaze you.


Maybe they're listening... at least to the extent they're capable.


First of all: Detroit is getting serious about luxury again, especially Cadillac and Lincoln... not so much Chrysler, although; who the heck knows what amazing things Marchionne might come up with when you least expect it.


Not that Cadillac hasn't made light years of improvement in image, perception, prestige, and engineering since 2000 ... BUT... I am getting impression phase two is on the horizon.

The Cadillac ATS coming out at the show is positioned heads up against the BMW 3 Series... Price, performance, quality, a great looking smaller luxury car; initial photos and everything you can read are saying "Wow!" this kid's going for a shot at the title.

Gotta say though... I thoroughly hate the name 'ATS' ...Alpha-numeric names is on American Cars is total bullcrap. I have said that repeatedly about  Ford as well as General Motors. Stop trying to be them, beat them with your own identity. American cars have names, and names build brand equity. Unfortunately, General Motors doesn't get that and keeps changing the names of their cars so the public can't build loyalty or brand recognition any more. Ford (Lincoln) is almost as guilty.

Apart from my little side rant there for a moment...

Lincoln is coming out with the 2013 MKZ, mirroring the new Ford Fusion and European Ford model, 'Mondeo', the MKZ will have an identity of its own. Both the Fusion and The MKZ are inspired from the concept Ford Evos but still a Mondeo at heart under the skin. In fairness though, I'm sure Mondeo has evolved.

They cannot afford to revert back to the 90's when they produced The Ford Contour and The Mercury Mystique, which were actually The Ford Mondeo, rebadged for the U.S. market with minor trim adjustments.

At the time I was on record calling those cars 'The Condor' and 'The Mistake'. Needless to say, I was right and Ford got their butt handed to them on that poor judgment brought to market.

Expected to debut in Spring as a 2013 model; The MKZ is going to be a heart-stopper, I've seen it firsthand BUT; let me assure you, it's only the beginning.

It's a huge Gamble that the new MKZ is not perceived as a Ford Fusion with an upgrade package, but rather; it needs to be seen (as I believe we will) as an entirely different animal.

The last

I had the opportunity as a guest of Jim Farley, VP Global Operations for Ford to visit the Lincoln product development 'laboratory' in Dearborn back in October. At the time I was given a guided tour by the design engineers on the project of all of the production and working concept Lincoln product beyond 2015. Say what you will, these guys are serious contenders to regain world-class luxury-quality-performance image and recognized status.

Ford Eco-Boost technology will deliver next generation performance as well as high MPG.

I had serious issues and reservations with the commitment Lincoln was asking of its dealers considering performance of the franchise over the last decade. AND, I still think the approach is wrong although they have the right idea. Cappuccino Machines and Wi-Fi Lounges do not sell cars, or even keep customers but, many dealers do need to make the facility upgrades if you are selling upscale luxury customers.  

The biggest thing that could kill the dealers' enthusiasm for the product is the quality of the representatives the manufacturers are sending in to inspect and implement. Sending in recent graduates with no life's experience or 'feel' for the retail automobile business to heavy-handed grade dealers progress is going to cause resentment  and culture clash.

The Lincoln and Cadillac customer experience is an educational process and the manufacturers need to design the curriculum.

Ford Fusion... should steal the show. I could write another 10 pages raving about Ford product quality and future product. These guys genuinely have their act together with what's in the pipeline.

Wasn't I the one that said 'Bubba' wouldn't drive a six cylinder F-150? Had to eat my foot on that one. The new Eco-Boost Six Engine is a phenomenon combining, horsepower, torque, and fuel efficiency...who woulda thought?

Maybe Sergio 'Gets it' more than his detractors give credit?

Memory flashes back to nights that found me leaning up against my Dodge Super Bee on the parking lot of the San Juan Krystal in Jacksonville, 1968.  Watching the continual parade of muscle cars circling the lot, cruising San Juan Boulevard; what you give to have any one of those today?

'68 was the high point of the muscle car era. That is when I saw my first Dodge Dart GTS with a 375 HP  440 Cubic Inch engine. Although the majority of Dodge Dart production was a 275 HP 340 CID engine, maybe a 383 CID 'B' block at 300 HP, and some were actually fitted with 426 Hemi engines @ 425 HP.

As small as a Camaro with a Hemi, impressive in the day.  It ran like a scalded dog...with any engine, the Dart was a screamer.

The Dart evolved into the Dodge Demon, which is another piece of historical brand equity in Chrysler's vault of great names the public identifies with.

Well ,fast forward to the Detroit Auto Show, January 2012... and Chrysler resurrects the model name with the unveiling of the new Dodge Dart.

Advance photos have been leaked all over the internet, and, at first blush this is a beautiful small car. Hailed as the first Fiat-Chrysler joint venture product, will it live up to its  namesake  legacy or be just another case of wasting brand equity on the wrong car... something General Motors has repeatedly done in years past. (remember how many times they stuck a GTO emblem on some nondescript piece of crap?)

Dodge continues to trumpet that the new Dart gets 40 MPG coupled with racing dash and trim, but I'm not hearing too much about performance capability. Is this a new millennium Dodge Neon, nicely equipped?

Regardless, some of the happiest campers on the planet  right now are Chrysler, Dodge, Jeep, Ram Dealers. (I still have a problem saying 'Ram")

Showing a 37% sales increase, the highest gain since 2008; dealers with Chrysler-branded products are experiencing a revival in brand acceptance and perception that is translating into sales. It's all good...and, so far...the manufacturer is not 'dicking around' with their dealers as much as most manufacturers feel inclined to do.

Acura

Usually not something I write about. I look at Acura as the franchise that should have prevailed but failed. Think back, they were the first Japanese manufacturer to enter into the Luxury arena... long before Toyota spawned Lexus or Nissan Infiniti.

For some reason or reasons, they've never been the player they should have been. NOT , that all of that can't change immediately. Look at Hyundai and Kia completely reinventing the brands overnight.

Acura is a great quality boring ride. Old ones make great tuner cars for 20 year-olds.

Maybe...just maybe...that's about to change.

One of the entries debuting at the Detroit Show is the new Acura NSX. Of course, I know what you're thinking; they used to have an NSX model...discontinued it in 2005 didn't they?

Well yeah, sort of. It was a limited production car that basically never got a real performance package or redesign.  Sort of an afterthought  like the Toyota Supra, another great car that was killed by factory incompetence.

Well, Acura may have awakened to an epiphany of clarity, and actually decided to be in the competitive automobile business after all. BUT, are they going far enough, or stopping short with traditional Honda/Acura reticence?

Production to sales slated as a 2014 model (probably debut in the spring of '13) the prototype is a smoking hot design meant to show off Acura technology advanced hybrid drive train. BUT coming out at 400 HP might be a bit of a yawn in light of competition in the segment i.e. Nissan GTR.

My question is, and always has been when dealing with Acura...will they build them and get them to the dealers?  Another is will they choose the right price point? AND, finally, will they promote it? Acura has a history of not producing what sells when it's hot. In that respect, they are sort of the General Motors of Japan.

Regardless, I am excited to see Acura making a definitive move at getting into the game with new Halo product.

Volkswagen Announces Ambitious Goal to Sell 500,000 units in the U.S. in 2012

I have always compared Volkswagen to the Detroit Lions of the car business... "You can always count on them to fumble the ball in the Red Zone".

Cracked myself up telling that one over and over again in years past as Volkswagen always came out looking good and then screwed up whatever momentum they achieved.

Well, you know what? The Detroit Lions are having a winning season and maybe, just maybe Volkswagen has the momentum, discipline and vision to finally make it to the goal line too. 

After all as far back as the late 50's through the 60's VW was the only import with a real foothold in the U.S.

They had the entire small car, fuel efficient market cornered with an extremely loyal following... They were first and entrenched long before the others...long before Toyota and Honda and the Japanese gained any momentum at all in the late 70's.

It's been 39 years since VW last posted that kind of market share. Now, CEO of VW America, Jonathan Browning, is publicly announcing half a million unit sales in The U.S. Market in 2012.

Not saying these people have lost their friggin' minds BUT  they have announced to the world that they are going to sell a million units a year in the U.S. by 2018... That's 800,000 VWs and a handful of Audis.

Remember, their best year ever was 1970 with 569,182 U.S. unit sales.

In fairness, they're coming off of 444,000 sales in 2011 and, they've got a lot of redesigned fresh product on the showroom floors. That's another 13% increase year-to-year. It does appear they have an 'up' arrow.

BUT, as always, the question is... "Do they really get it?"

Volkswagen has always had the same crippling handicap paralyzing sales and growth... it's the Germans.

There is an aura of know-it-all arrogance and faux-superiority that pervades  and dominates the decision-makers of VW- Porsche-Audi top management back at home in Wolfsburg. They just don't listen.

Remember we have people there that name their cars after mutant strains of foot fungus. People who have, in the past, insisted on boring dashboard controls with international symbols... do they get it? Do they really-really get it this time?

Redesigned Beetle and Passat have a lot of momentum and enthusiasm...of course , in the past they've always managed to drop the ball at the goal line. Let's see what happens.

Truthfully, I have a lot of friends who are VW Dealers. I'd love to see the franchise have an incredible surge.

The Audi product is world-class, matter of fact, I believe it's the one to watch amongst highline German Luxury. Globally, Audi is making a serious run at Mercedes and BMW sales and global market share.

They've hit the ground running with serious product and, Volkswagen says they will have a U.S. Plant producing Audi before 2015.

 

Chevy Volt

Let's be clear here. Chevy Volt is a great car AND the defect is highly exaggerated and sensationalized.

Okay, yeah, I know it caught fire weeks after the crash test as it sat there unattended. Is that a realistic situation?

How many cars are going to sit that long without being scrapped or repaired?

Anyway, GM has come up with the fix, whether it needed one or not.

Doesn't this smack of the same over-exaggeration that caused the entire world to unjustly pile on Toyota last year?  I am chalking this one up to the press-op-grabbing bureaucratic 'persecution posse'.

Regardless, Volt and Nissan Leaf are falling far short of sales projection in an otherwise thriving market.

Speaking of Shows

The Big-Show is coming up in February... The NADA Convention is in Las Vegas this year. I have not missed an NADA Convention since 1986. It is the event of the year, and you, the dealers and management should not miss it.

The 2012 Convention pre-registration tells us it's the biggest attendance since the economy crashed in 2008.

How can you possibly be current with everything you need to see  and do as a dealership in this rapidly evolving retail environment unless you attend the convention?

The NADA is your organization, and believe me, they do a lot behind the scenes to protect your best interests.

I hear a lot of you complaining and criticizing. You need to attend the convention, support your National and State organizations... Get involved and get vocal. If you don't like the way it is, stop bitching and get involved or shut up and sit down.

I am speaking at the Convention again this year. It will be the 14th or 15th time, I have actually lost count since 1987. My workshop this year is on F&I Word Tracts...20 persuasive things you say to a consumer to sell product.

You know, this is sort of back to my roots... F&I is where I started back when.

This year NADA has invited me to perform an added "International" session.

By the Way! My trophy wife, Debbie and I are looking for some invitations to some of the better parties... call me or email.

Also, my friends Brian Pasch and Paul Potratz are speaking... don't miss their sessions. These guys are the ultimate experts.

 

Do Not Miss Battle Plan!

 

January 18th-19th is my Super Seminar in Atlanta...

Internet Battle Plan VIII

Are you satisfied with your Internet Automobile Sales?

Well, this is the 8th time I've assembled a team of top automotive internet and marketing sales experts in their specialties for a two-day, high content event.

Real how-to training for dealers and managers. We are teaching nuts and bolts... how to actually do it. You can implement what you learned here the day you return to the dealership...without having to hire a vendor to do it for you.

Don't miss it, there is still availability if you act now. Go to http://www.internetbattleplan.com for all of the information about Battle Plan

 OR call me (800) 726-0510   9-5 est

Leading up to the NADA Convention is another premier event... 

The Digital Marketing Strategies Conference in Las Vegas. http://www.digitalmarketingstrategies.org/

Organized by Brian Pasch, it's is a first-class educational experience and

opportunity to increase your online sales.

And, by the way, I am also speaking at the Digital Marketing Strategies Conference. Don't miss it!

As always, I am traveling 200 days a year, out there somewhere, working,

Speaking and Consulting in dealerships.

An empty snifter of Remy-Martin Louis XII vintage cognac sits by the keyboard and I am well-satisfied with the content of another article. Please comment and email me. JIM


PLEASE CHECK OUT JIM ZIEGLER'S MEGA BLOG...

TRUE CAR and ZAG Cyber BanditsParasites or Good for the Car Business?

http://www.TrueCarDealer.com/

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