AutoSuccess – October 20, 2021

3 Auto Retail Insights My News Show Guests Shared for Your Ears

By Dennis McGinn

This month, I am reporting three insights from retail auto business leaders, which they shared with me for your ears recently.

These newsmakers are guests on a new video magazine called YOUR PLACE, which Babcox Media, the publishers of AutoSuccess magazine, and I will launch soon.

The guest observations that follow are from recently broadcast shows or the taping of shows broadcasting soon:

The Tech Shortage Jared Ricart, President, Ricart Automotive Group:
Resolving the technician shortage goes well beyond a dealership and the ability to fix a car. Developing technicians help the dealership and the community of car buyers and businesses that rely on transportation. We work with our local community college's vehicle technology school, developing programs and employing auto tech students while they learn. It is up to dealers to be prepared to take care of the consumer and the community, and we're providing pathways and careers for young people exploring options. Why not help them along? That way, they don't spend $140,000 on college education they're never going to use. An employee does only recruit, develop and retain technicians. EVs create new challenges. A Ford F-150 has 150 million lines of computer code in its five computers communicating on three networks. We're helping develop technicians who need to be part auto mechanic, part heating and cooling expert, and electrician. That's a huge hurdle.

The Modern Dealership Steve Greenfield, Automotive Ventures:
As EVs come on, dealers need to consider a few things. One is, "If I'm going to start selling more EVs as the OEMs are wanting and the U.S. government is stimulating, how am I going to prepare for that future? Am I going to, for example, for a consumer that buys an EV first visit their home or office to make sure they've got the right charger installed? And can I participate economically in installing the charging infrastructure in their home and make sure they're set up correctly? Do I need to invest in chargers at the dealership, and if so, which chargers are best? And do I need to have different adapters for different types of vehicles that may come in? Do I charge for that electricity, or do I offer that as a perk?" Every dealer is wrestling with right now. An opportunity to note the weight of these cars and torque to wheels means tires wear 30% to 50% faster. Enterprising dealers will consider building retention into these owners because they'll need tires twice as often. The franchise dealer should be convincing the consumer that service work on these complex machines requires sophisticated electronics to test and service – and factory-trained technicians to do that. And franchise dealers who can communicate the complexity of even today's complex cars to the consumers will win back a higher percentage of that service work to offset business lost because of EV service intervals and opportunities.

Less Can Be MoreDavid Simches, group used car director, Crown Automotive Group:
When you stick with the basics – a good appraisal process and a good service drive process, meaning buying cars from the public -- you can get all the vehicles you need. It is this process that has kept used car inventories up at our 22 locations through the pandemic. While shortages and higher car prices are sexy to talk about, the next big struggle for the industry is production. By production, I mean getting cars through the shop. To ensure this production focus with our stores, I meet weekly with each store's reconditioning, service and parts managers, and internal service writers in 10-minute Zoom huddles. We go through everything related to production goals through recon. This focus makes recon a priority. Some dealers fudge their recon production numbers by shortcutting their reconditioning to rush them to the frontline to sell faster. Many reasons that, especially when demand is high, customers don't care that much that the car they buy isn't picture-perfect. That too often ends up in those cars coming back one, two, and three times to have issues resolved for their buyers that should have been handled by proper reconditioning in the first place. Stores whose production rate includes thorough reconditioning and three-to-five-day time to line and speed to sale deliver real advantages in their markets.

Here’s where you can follow YOUR PLACE to stay current with each edition.

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