Thursday, December 4, 2014

2014: "The Year In Review"

Each year at ACG "Smart Parts", we dedicate our last issue of the year looking back at the year in review. From my perspective, not only do I enjoy "drilling down" the year in general, it's also kind of a "wake up" call. The year always seems to pass by so quickly and many times, we don't even know what hit us.

The "Year In Review" not only wakes me up, it prepares me for moving forward into the next year. The research helps to put everything into perspective and I would encourage all "Smart Parts" Readers to do the same. 

Before we get into some of the numbers, trends and overall analysis, I want to provide everyone with the sources I used in this research. Keep in mind, other than our own data here at ACG, all this information is readily available to everyone out there on the internet.

For years, N.A.D.A. (National Automotive Dealers Association) and Automotive News have been the standard resource for most dealers and I agree 100%. I will be just scratching the surface with some of this information sharing, but all of it is available online.


NADA DATA   Annual Financial Profile 2014
Automotive News November 2014 Issue

Currently, there are 17,665 new car dealers in the United States with California and Texas leading the way with 1,377 and 1,210 dealers respectively. This in itself is a pretty interesting number considering that there used to be well over 20,000 new car dealers in the U.S. not too many years back.

Through November 2014, the "Big 3" are back in line leading the way with GM, Ford and Chrysler. The next 3 include Toyota, Honda and Nissan in that order. That's a pretty big shift over the previous few years as domestics have stepped up to plate to get back into the race. 

Even though there are fewer new car dealers now compared to a decade ago, sales are on the rise! Overall new car sales rose 7.5% from 2012 to 2013 and current, through November, new car sales are up 5.4% over 2013. These numbers are pretty impressive and actually, since 2010, each year has shown increases overall.

As a matter of fact, N.A.D.A. says that their "Optimism versus New Vehicle Sales" Report numbers have been steadily climbing as well since 2010 to support these overall sales increases. Another astonishing fact that shocked me was that New Vehicle Net Profits are also up since 2011, increasing each year after a previous decline of five years.

Why are these statistics important?.....

Quite simply, as more "iron" hits the road, the more opportunities there are for Service and Parts Departments. Fixed Operations have also followed suit with the New Vehicle Sales increases as total Dealer Fixed Operations Sales rose 5% from 2012 to 2013 at a whopping $84.6 Billion Dollars. Many believe that 2014 will surpass this mark as well, currently tracking at a 4.8% increase through November 2014.

Overall, the Fixed Operations may only account for 11.6% of total dealer sales thus far in 2014, but when you consider the gross retention side of the equation, that's whole different ball game. Those percentages are much higher as represented in substantial increases in "Fixed Coverage" and overall "Service Absorption" in many dealers over the past few years. 

In my opinion, the opportunities ahead are as good as I've seen in my 35 years in the business. The opportunities are always good, but it's not that easy when you compare these new opportunities to some in the past. Competition has always played a role, but retention is where it's at. We need to get our customers coming back.

If we don't have the right people following the right processes, all these new opportunities fall by the wayside. I have met, trained and coached Fixed Operation Managers over the years and if there's one thing that I hear most often from the "seasoned" veterans out there is..."Dave, it just doesn't seem as easy as it used to be..."

This is what separates the "good from the great" as the ones who are great take the necessary means to keep up with people, process, accountability and on going training/coaching. It never stops and will always be on going.

As a third party to the dealer, we have definitely seen a rise in the dealers' interest in training and coaching in 2014. In the car business, we all know that there are "waves" that are cyclical in nature and it's upon us again. Training and Coaching is coming back to the fore front.

As I mentioned earlier, there are 17,665 new car dealers in the United States, not counting our friends to the north in Canada. In 2014, ACG's "Active Contact List" of New Car Dealers has risen to 22.6% in just one of our social media venues. These are also key indicators that follow earlier trends mentioned.

For all my "Smart Parts" Readers out there?...

Strap yourself in because 2015 is right around the corner and even though we are wrapping up another great year at ACG "Smart Parts", we are also poised and ready for our "Best Year Ever"!! Numbers don't lie and these statistics represent another great year is upon us!!

Are You Ready?.....

Dave Piecuch is the Vice President of Automotive Consultants Group Inc. and is the Head Coach for Smart PartsTMThe only "Results Based" High Return Training, Coaching, and Consulting company in the world!  Dave can be reached at Cell 786-521-1720 or E-mail at Vist our Website at