#Dealers

Yup, it's podcast day! Spend some time during the long weekend with us!

One of my favorite moments in The Sopranos involves mobsters trying to shake down a large, faceless corporation. When the mobsters are told by the manager of a local store that if he acquiesces, he'll be fired and replaced by someone else and the corporation will make sure the mob doesn't get any money.

Perplexed, one says to the other "it's over for the little guy."

That scene came to mind when reading/editing Matt's piece on Penske Automotive Group scooping up another prolific Ford dealership.

As predicted, the catastrophic CDK ransomware outage seems to have had an impact on car sales in this country, with companies like Stellantis and Kia recording drops in volume.

The vast majority of our readers are up to speed on the CDK ransomware attack, a cybersecurity incident which brought the software used by over 15,000 North American car dealerships to its knees. With second quarter sales numbers due out this week, speculation is running rampant about the effect it will have on the total number of deliveries reflected in official reports.

It appears at least one brand is recognizing the importance of a well-informed owner, with Nissan choosing to offer a so-called Second Delivery for its all-electric Ariya. Interestingly, a dig into the program reveals that dealers can farm the duties out to a third party called Doppler Automotive.

Late last week, the National Highway Traffic Safety Administration issued a letter to Nissan requesting they recall a batch of Sentra sedans thanks to tie rods that may bend and cause steering issues. A total of 236,238 units may be affected, ranging from the 2020 – 2022 model year.

Over the weekend, your author happened upon a rural Ford dealership seemingly frozen in time, still using signage from past decades and proudly eschewing whatever cold corporate design is currently being foisted upon dealer principals by The Suits in Dearborn. It was neat to see a store embrace its heritage.

Not all are so lucky, such as a San Antonio Hyundai dealer who is currently removing what many are describing as a local landmark. Why? According to the dealer group’s head of marketing, it’s not part of the “Hyundai experience.”

After weathering pandemic-related shutdowns, chip shortages, and barren lots, some dealers are complaining our nation’s rail system is suddenly no longer up to the task of delivering new cars. A few are saying they have a point, whilst others muse it is a bit of karma for three years of price gouging and “additional dealer markups”.

When I worked as a service writer, an upset customer threatened to kick my ass right then and there in the service drive. If I recall correctly, he was upset because there was a language barrier and the price for the service came in higher than he'd expected.

Anyone who has ever bought a new or used car from a dealership knows the minefield of add-ons customers must generally navigate before signing on the line which is dotted. Just this week, my own parents were presented with a deal sheet that showed an admin fee ($799), tire warranty ($499), and undercoating ($999) on a second-hand Lincoln from a non-Lincoln store. They walked.

Consumer Reports has recently published a list of dealership extras they recommend binning when buying your next car.

We've covered two stories today in which the dealership model comes into play.

Electric-vehicle startup Lucid has sued the state of Texas, saying that the rules around selling cars in the Lone Star state are so restrictive they amount to "economic protectionism."

We all know GM takes the C8 Corvette Z06 very seriously; putting that particular engine amidships surely took an act of divinity and Alfred P. Sloan himself. But a recent inside look at dealer training materials provided to sales hacks shows just how seriously they're taking the thing - pitting it against a $300,000 Ferrari.

We would wager our combined annual salaries – a sum roughly equal to the value of a half dozen donuts from Krispy Kreme – that every single soul reading this website has a story or three about being blitzed with products in a dealer’s F&I office. Vehicle etching, useless warranties (sorry – this paper only covers mechanical fuel pumps), and p-packs up the wazoo are the bane of most shoppers’ existence when trying to buy a car.

Make no wonder some people call it the “Effin’ Eye” office.

This environment may change if the Federal Trade Commission gets its way. According to a report by Automotive News, a new proposal by the FTC would ban finance/insurance coverage and physical vehicle add-ons “that provide no benefit” while also requiring expanded disclosure on such items.

Younger drivers have reportedly had it with the dealership experience, with Gen Z even more disenfranchised than Millennials. Though it’s difficult to imagine anybody visiting a showroom within the last 12 months having any other reaction. Incentives are down, prices are up, and there’s a good chance whatever you wanted to buy isn’t going to be on the lot anyway. Someone saying they had an exemplary dealer experience is becoming about as common as people claiming they enjoy going to the DMV.

However, CDK Global Inc. still opted to conduct a survey in the hopes of determining just how much less tolerant younger shoppers might be compared to older generations. The takeaway probably isn’t going to shock you, even if the sheer volume of first-time buyers that don’t care for dealerships might.