Crisis in Japan - Is your Dealership Worried?

[Jeff Kershner]

I was sitting in our monthly marketing meeting earlier this week and building out our marketing strategy for the next few months.

I have a Nissan and a Toyota dealer - topic of conversation revolved around possible reduction in inventory from the effect of the recent crisis in Japan. Even our Mercedes are being affected due to the navigation system coming out of Japan.

If inventory dries up - should we consider cutting back our marketing? With only so many vehicles to sell, our price per vehicle in advertising could shoot up fast.

I've been keeping an eye on AutomotiveNews.com for all the latest news. Automotive News -- Crisis in Japan

I say we continue to do what we do. No matter what, we need to keep selling cars while branding the dealership. The market for our dealers were strong for the month of March.

Who else is worried about the possible reduction in inventory over the next few months?

 

[tomwhitejr]

We have purchased every new car we possibly can - taking our inventory to uncomfortable levels in hopes that the rest of the competition will run out of cars and we will be primed to take market share. Dangerous gamble, but with gas prices where they are at, we feel good about our decision.

I just can't fathom cutting back marketing dollars when opportunities to dominate present themselves. We will be increasing advertising dollars and going into attack mode to sprint through the summer.

Don't know if its the right decision or not - check back with me in September and I'll let you know how it goes...

 

[Jeff Kershner]

It's about time someone jumps on this thread.

My Nissan store has been gearing up on New and Used economy cars as much as we can. We've been hitting direct mail Buy Back campaigns hardcore (database and conquest) with some good success. We should be good for awhile but if it hits us harder than expected, we could be operating a used car dealer.

Toyota dealer - for the time being we have plenty of inventory but inventory dries up and it has an impact on a few months out, it could get a little scary.

I agree with you Tom. Gear up and take it head on. No matter, we need to keep selling cars and we need to keep advertising. If you're going to crash and burn you may as well do it right.

 

[joe.pistell]

We're in a great business.

Good times or bad times, low or high gas prices, people still got to get to work and their cars are don't get better with age.

 

[ed.brooks]

"General Market Update, a Q&A with Dale Pollak"

vAuto's Founder, Dale Pollak will be holding a webinar on Tuesday, April 26th at Noon EST, titled "General Market Update, a Q&A with Dale Pollak".

He'll be discussing what is happening in the marketplace today, including the impact of the Japan crisis and rising fuel costs. All participants are urged to send Dale questions in advance of the webinar. Questions should be sent to [email protected].

More information and a link to register available at DalePollak.com

 

[MullerToyota]

We are getting all the money on the Prius right now. Too bad we only have 2 left...

I have seen some surprising increase in pricing from local competitors. I have also seen some competitors pushing their whore-ishly low prices and getting a lot of business because of it. We are still sitting much where we always do on pricing, but we've never been ones to aggressively price our cars vs. our competition. We have raised our prices a tad on Camry and Corolla.

I don't know if there is much we can do except wait and see what happens. I know if we sell all our cars that I will get a couple of days vacation! :P

 

[DanMorgan]

we have an ok inventory now but its going to get brutally thin starting in May and will probably be through the summer. Our first allocation of cars in May will have around 10 cars on it, when it normally has at least 30-40 (bi-monthly). So when they are saying 2/3's of the supply is lost, they aren't lying. Still trying to keep my chin up since I'm having a great month so far

 

[CliffC]

Some dealerships should consider picking up a late model salvage car or two as parts dry up to lessen the need for service to "cannibalize" new cars off the lot.

 

[Jeff Kershner]

Sitting on the webinar with Dale Pollack right now. He's suggesting that dealers keep steady and continue to price their inventory aggressively to market where as most dealers are quick to price higher due to concerned volume and demand. Pricing aggressively will still allow you the advantage of gaining traffic and opportunities, which of course will gain you the trade-ins you are looking for.

Of course if you have a tool and aggregates market data, and dealers in the local market are raising prices, you would also naturally raise your price while also being aggressively priced to market.

Import dealers being affected - don't back down, keep the velocity pace. Supplement your new car inventory with great used car - high demand used cars.

This is a great time to get your AutoTrader Trade-In Market (TIM) baked into your showroom process.