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Similarly, a sudden drop in usedcar prices from post-COVID highs resulted in many vehicles not being repaired. For instance, as vehicles become more complex, the cost of repairing crash parts with all the added sensors and technology might lead to higher total loss ratios as these cars depreciate. He is based out of Toronto.
When you think car business, you immediately picture a salesperson. We put all our energy into selling and almost nothing into buying cars. Usedcars generate 33% of a dealerships revenue, not even counting service. Vehicle acquisition management software is changing the game. But weve got it backwards.
Consider these actions to reduce market risks to usedcar profitability. Appraisals As you evaluate potential trades and walk private-party purchases and auction cars, use your good sense, but be humble and back that estimate with a VIN scan. Speed repair approvals between the recon department and the usedcar manager.
OK, I do not want to be Chicken Little crying that the sky is falling, but I hope to encourage you to look at the reconditioning practices of your usedcar department. Less inventory is required to maintain sales because you can recondition more cars quickly (three to five days efficiency is the reconditioning gold standard).
The software itself and the platform truly make it a one-stop shop. Giron says the dealerships usedcar manager can view the videos and pictures on his phone to check the work thats being done to recon cars, allowing him to effortlessly approve a vehicle for use.
We talked with their usedcar manager, Bryan Bough, about their private-party buying program. They didnt just tweak their existing process; they completely reinvented how they acquire usedcars. Higher Margins: The dealership earned an average of $7,000 per car by combining front-end sales, financing and service revenue.
While some dealerships are happy sending their usedcar manager to the auction, others who aren’t satisfied with that approach need to get a little scrappy and think outside the box. Finding a good usedcar buyer is one of the biggest hurdles dealers face when trying to explore alternative acquisition channels.
When using a private-party management software, dealers see up to an 84% reduction in acquisition costs and two to three times total purchases per month. Bryan Bough, usedcar manager at one of the largest auto groups in Boise, Idaho, recently said to us: “If you’re not buying cars from the public, you’re making a huge mistake.
While dealerships focus on reconditioning usedcars, the efficiency of the PDI process for new cars is equally vital. When cars spend less time in the PDI phase, they can be delivered to customers faster, reducing inventory holding costs and improving overall dealership profitability. Here’s how: 1.
Dealers today enjoy more predictable usedcar results because they leverage strategic reconditioning software’s robust efficiency metrics called time-to-line or T2L, a process we introduced to the market in 2010. The profitability of usedcars has been, until now, primarily determined by demand and availability.
If you want to manage inventory holding costs and bolster your earnings per share, consider how your usedcar reconditioning operates. Cars get sale-ready within three to five days of acquisition. You’re buying the wrong cars if this isn’t consistently happening. When recon is run well, it is dialed in and efficient.
After pouring countless amounts of energy into the never-pretty process of getting usedcars through the shop faster and on the lot for sale — then what? It’s common knowledge that the real rewards and internal gains only come when the car finds its new owner.
New VIN-scan tools that integrate with reconditioning software can provide deep, rich mechanical systems data and accurate reconditioning parts and labor costs for the vehicle make, model and year. This is critical information to have in hand when used by any dealer — and especially by public groups — seeking to bolster earnings per share.
The Environmental Protection Agency accused Volkswagen of equipping its diesel vehicles with software designed to manipulate emissions tests, and while litigation was pending, Volkswagen dealers had to issue a stop sale on all their TDI vehicles. One of the main reasons we had pursued [Volkswagen] was because of the TDI,” Church says. “You
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