Local car dealers trying to drive sales despite stalled economy

Published 12:00 am Wednesday, December 2, 2009

By Mark Wineka
Tom Stancil of Salisbury signed up for the truck giveaway Monday night at Cloninger Ford-Toyota, grabbed something to eat and walked around the showroom’s new Ford F-150 Lariat.
He liked what he saw. The redesigned truck seemed especially roomy. Stancil asked about the tailgate step and watched a demonstration of the bed extenders.
Stancil said the continuing onslaught of negative economic news doesn’t necessarily keep him from considering a new vehicle.
“It’s going to happen whether you like it or not,” he said. “You just try to do the best deals you can get and take it one day at a time.”
Salisbury car dealers would like all consumers to think as Stancil does. They say it’s really a great time to buy a car or truck, even though it’s not the best of times to be selling them.
“Things are difficult,” said Gerry Wood, who owns Honda, Kia and Chrysler dealerships in Salisbury. “These are very difficult times.”
Cyndie Mynatt, owner of Ben Mynatt Nissan on Jake Alexander Boulevard, said sales are probably as slow as she has ever experienced, “but I’m still a young person.”
“It’s really a matter of consumer confidence,” she added. “People are taking a wait-and-see attitude.”
The car dealers have braved it all this year.
When the cost of gasoline was $4 or more a gallon, Mynatt said, the shift in what people were buying went overnight from full-size vehicles to compact cars. Then came the real estate and mortgage crisis, followed by the stock market’s plummet, higher unemployment, factory closings and the election.
“Everything came to a screeching halt,” she said. “People were frightened. They didn’t know what was happening.”
October was her worst month, as it was for car dealers across the country. Interestingly, Mynatt said, two days after the election, sales began rebounding somewhat, and national sales figures bear her out.
“So much of it is mental,” she said.
November new vehicle sales, while expected to be 27.6 percent behind November of last year, are projected to come in almost 2 percent above October, according to Edmunds.com’s forecast.
Sales are improving thanks to record incentives, the election’s being over and lower gasoline prices that are causing people to look again at deals on SUVs and trucks.
Thom Dillard, owner of Team Chevrolet in Salisbury, said customers are seeing prices on SUVS they might never have imagined.
One of the bigger psychological hurdles for dealerships has been all the media attention paid to the Big Three U.S. automakers’ request for government help to stay in business.
“Everyone needs to understand this is not a bailout,” said Dillard, who has personally visited with U.S. Sen. Elizabeth Dole, R-N.C., to explain why a loan to the domestic automakers is crucial.
“We’re talking about saving a whole industry,” Dillard said. There are three million U.S. jobs connected to making automobiles, and 20 percent of the sales tax revenues in North Carolina come from car sales, Dillard said. Some 80 percent of the dealerships in North Carolina are family-owned and employ at least 50 people, he added.
Plus, right at 50 percent of the cars sold in the country are American made. It tells him, Dillard said, that people want American vehicles and General Motors, for one, has products such as the Chevy Malibu and the Cadillac CTS that are winning car-of-the-year awards.
Dillard’s own dealership is having the Chevrolet “Red Tag” sales event. Overall, interest rates for cars are low, credit is available and the incentives are “historic,” according to car dealers.
“There are some real opportunities out there,” Dillard said.
Wood, who sells both imports and domestics, said he was uncomfortable talking about how his business was doing and what was being said in the media.
“I wish the media would quit looking at the glass as half empty and look at it as half full,” Wood said. “… We need a positive attitude in the country. Let’s not beat ourselves to death with the negative.”
Both Wood and Mynatt said there is plenty of credit available for people to buy cars. “I’m here to dispel that rumor (that there isn’t enough),” Mynatt said.
It’s a “phenomenal time” to buy a new car because rebates are the largest they’ve ever been, Mynatt said, and good deals are being extended to used cars.
In bad sales times, dealerships depend on their fixed operations such as service departments, parts operations and body shops to pay the bills. Under normal circumstances, those operations keep the lights on, and sales are where profits are made.
Mynatt said any business, car dealerships included, learn bad habits in the good times and good habits in the bad. Her dealerships are pulling back in some areas and alternating between offensive and defensive strategies, “which is what every business is doing,” she said.
As a way to entice people into its dealership Monday night, Cloninger Ford-Toyota held a “sneak peek” for its new Ford F-150. The whole showroom was dedicated to information on the truck with numerous hands-on displays and an army of sales people ready to talk about the truck.
Jay Donaldson, a Ford dealership trainer-facilitator from Detroit, taught the Cloninger sales force all about the truck and was on hand for the consumer preview Monday night.
The newly designed F-150, a sales leader for Ford for three decades, ranges in price from $21,095 to $43,885 and above, depending on the options. The redesign was four years in the making, Donaldson said.
He touted the “work solutions” options available to contractors. The “cable lock” serves as a handcuff for tools, so no one can lift them out of the truck bed.
The “tool link” tags tools in the truck bed, and the in-dash computer can tell the contractor, before he leaves the job site, whether any tools are missing.
A computer GPS feature, which tags other vehicles, also can inform a crew chief or fleet manager where his other trucks are, how fast their traveling and redirect them to a new site.
Donaldson said the F-150 is best in its class for hauling and towing and has a exclusive option for both integrated brake and trailer sway control.
“The big thing for me is what they’ve done for safety,” Donaldson said of the new F-150. He used a touch screen display to show where high-density steel has been added on the frame to give strength and how the passenger cab was improved through air-bag systems and crash absorption strategies.
Matt Thompson, a self-described Ford man, came for a look at the new truck. An architect and construction administrator, he routinely drives his 2005 F-150 to job sites.
“This one is 6 inches longer and looks like it has so much more room in it,” Thompson said.
Would he consider buying a new truck in these tough economic times?
“If I could afford it,” Thompson said.