March 7, 2016
This Time, No Sweat Over Hot Fleet Sales
According to Automotive News, Ford Motor Co. and Fiat Chrysler both had their best February for U.S. sales since 2006, and Nissan North America posted its highest market share for any month ever. Meanwhile, General Motors is on pace to lose share for a fifth consecutive year. For all four companies, the explanation largely comes down to one word: fleet. GM's fleet deliveries dropped 24 percent last month, resulting in a 1.5 percent drop in the company's overall sales. In contrast, FCA's fleet sales surged 39 percent, Ford's jumped 42 percent, and Nissan's soared 54 percent. Those gains helped push the U.S. light-vehicle selling rate to its highest level for any February since 2000. Sales rose 6.8 percent from a year earlier, setting the stage for a boisterous start to the traditional spring selling season this month. Fleet sales took on a negative connotation in years past when the Detroit 3 used bulk sales as a convenient way to unload excess inventory, often at a loss. Since the recession, analysts say, fleet sales generally have been less abused, but February was the industry's most fleet-heavy month in almost six years. For more on how fleet sales impacted the February auto market, click here.
Predicting Tomorrow's Collectible Cars
The Detroit Free Press reports that the age of self-driving vehicles may be nigh, but the 2016 cars collectors will cherish a generation from now are the ones that maximize driving fun, according to the largest insurer of collectible cars and boats. Fun, performance, and scarcity distinguish cars on Hagerty Insurance’s annual “hot list of future collectibles.” Vehicles that cost less than $100,000 and are 2016 models are eligible. “Despite all the negative talk about the future of the car, this is one of the most exciting times to be a car enthusiast,” Company CEO McKeel Hagerty said. “Manufacturers seem to have found the golden combination of performance, handling, safety, and styling. The cars on this list check all of these boxes and will be desirable for years to come.” This year’s most collectible, with quoted comments from Hagerty Insurance, include the Mazda MX-5 Miata, with a base price of $24,915. The latest version of Mazda’s loved little roadster “is quickly gaining the respect of driving enthusiasts.” Also on the list: the BMW M2 $51,700. Widely acclaimed as the BMW-lover’s BMW, the new compact coupe is one of the year’s early hits. For more on Hagerty’s list of tomorrow’s collectible cars, click here.
Subaru Unveils New Car Platform, Autonomous Driving Goals
Subaru has unveiled a next-generation vehicle platform it says will improve safety and driving performance while keeping the small Japanese automaker competitive through 2025. According to Automotive News, the new architecture will underpin all the brand’s nameplates beginning with the redesigned Impreza small car arriving in the second half of this year. The Subaru Global Platform is designed to accommodate gasoline drivetrains in addition to traditional hybrid, plug-in hybrid and all-electric systems. Details of the new technology were outlined today by executives at the global headquarters of Fuji Heavy Industries, Subaru’s parent company. The platform is a key pillar of Fuji Heavy’s plan to achieve worldwide sales of 1.1 million vehicles in the fiscal year ending March 31, 2021. “Starting with the car coming out this year, we will advance the next level, using the new Subaru Global Platform to provide Subaru with more safety and fun every year,” said Naoto Muto, executive vice president for global engineering. The new platform should be able to underpin Subaru vehicles through 2025 with regular improvements, executives said. Read more about Subaru’s new car platform here.
Leasing of Light Vehicles Sets Record in February
Vehicle leasing as a percentage of monthly light-vehicle sales hit a record in February, representing nearly one-third of retail volume and helping to keep down the average monthly auto payment, reports The Wall Street Journal. J.D. Power estimates 32.3 percent of the 1.03 million cars and light trucks booked as sold by auto makers were financed via a lease agreement. That percentage was sharply higher than the 28 percent average for leasing set over the course of 2015, which was a record year for both leasing volume and light-vehicle sales. In January, 31.6 percent of retail vehicle sales were leases. Unlike vehicle purchases made by a buyer using a loan or paying cash to own an automobile, a finance company—often owned by the auto maker—owns the car over the term of the lease. Terms of the lease are based on the expected value of the vehicle at the end of the term, but auto makers and finance companies often subsidize the deal to make the monthly car payment more attractive. Starting this year, a swell of off-lease vehicles are expected to return to the market because of the steady rise in the financing tool in recent years. For more on vehicle lease rates, click here.
Some Dealers Still Leaving Oil Change Revenue on Table
Many dealers are caught up with the idea that if they can change oil in 15 minutes or less they are doing a great job. However, the point isn’t to rush through the process, but to maximize revenue, according to WardsAuto. According to the National Automobile Dealers Assn., U.S. dealers are capturing only 23 percent of the oil-change market. Customers continue to stay away because of inconvenience, perceived high prices, and ineffective phone skills of dealership employees. OEM quick lube/express service programs are designed to address all these issues, but for a dealership to increase its oil-change market share it needs to create awareness. For starters, a dealer’s website should have a page dedicated to Quick Lube, and the sales department needs to let customers know quick lube is available when they sell them a car or truck. The service department also should focus attention on quick lube during new-owner clinics, and dealerships need effective marketing plans to attract customers via mailers and other channels, including digital. It also is a good idea to run the service as a stand-alone business with a dedicated manager and staff. Read more about how dealers can maximize oil-change revenue here.
Is Your Dealership One Share, Send, or Like Away From Disaster?
The largest increase of HR-related claims come from inappropriate use of mobile devices and social media. Join AIADA’s March AutoTalk webinar to hear Laramie Sandquist, General Manager, Risk Management Resource, Federated Insurance, discuss how mobile devices and social media are turning traditional HR rules upside down. Laramie’s material has been featured at NADA Academy. Don’t miss this session! Topics discussed during this webinar will include: The fastest growing HR risks are coming from technology and social media related issue; listen to real world claims and examples involving text messaging, photo sharing, instant messaging, Facebook/Instagram posts, and other non-traditional employment risks; the risks these issues pose to you, your employees, and your business; and how to implement strategies and processes to address these evolving employment issues. To register for the 10:00 a.m. EST session, click here. To register for the 4:00 p.m. EST session, click here.
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