YOUR CONNECTION TO ONTARIOâ€™S USED CAR INDUSTRY
THE ONTARIO UCDA
VOLUME 5, ISSUE 4
THE OFFICIAL MAGAZINE OF THE USED CAR DEALERS ASSOCIATION OF ONTARIO
THE FUTURE OF DEALERSHIPS
PLUS DEALER PROFILE: FOSTER AUTO /24
WHOLESALE MARKET ANALYSIS /19 NOVEMBER 2017
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THE ONTARIO UCDA
IN THIS ISSUE
VOLUME 5, ISSUE 4
November 2017 USED CAR DEALERS ASSOCIATION OF ONTARIO 230 Norseman Street, Toronto, ON M8Z 2R4 Tel: 416.231.2600 Toll Free: 1.800.268.2598 firstname.lastname@example.org
FEATURED STORIES Workplace Safety Jim Hamilton
ucda.org | ucda.com Publication Mail Agreement #41890516
Plans For Success by Lori Straus
ONTARIO DEALER is published by Laservision Graphics Ltd. four times a year.
130 Industry Street, Unit 36, North York, ON M6M 5G3
Revisting Used Car Leasing by Dan Croutch
EDITOR Gina Monaco Tel: 1.647.344.9300 or 1.289.456.4617 email@example.com
Ontariocars.ca Has Launched
Terry Coster Direct: 416.360.0797 Office: 647.344.9300
05 07 09 11 12 16 19 23 24 34 37 40
The Driver’s Seat Warren Barnard
Editor’s Note Gina Monaco
Member’s Corner Bob Pierce
The Law Matters Jim Hamilton
The Future of Dealerships David Miller Trends Chris Chase
Wholesale Market Analysis Chris Chase Canadian Automative Museum Dealer Profile Lori Straus
Tech Talk Angela West
The Common Lawyer Justin M. Jakublak
Old Car Detective Bill Sherk
CONTRIBUTORS Chris Chase, Dan Croutch, David Miller Bill Sherk, Lori Straus, Angela West. If you are interested in having your personal opinion heard, contact the editor at firstname.lastname@example.org
The publisher of The Ontario Dealer reserves the right to turn down any advertising or content submitted to it. The Used Car Dealers Association of Ontario and the publisher accept no responsibility for claims or statements made by advertisers in this publication or by the independent authors of articles appearing in this publication. All statements and opinions appearing in this publication are those of the writers themselves and are not to be construed as reflecting the position or endorsement of the Used Car Dealers Association of Ontario or the publisher.
VOLUME 5, ISSUE 4 | 3
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*To qualify, simply become a newly registered buyer of IMPACT Auto Auctions before Dec. 15th, 2017 and purchase your first vehicle within 3 months, online or in-lane. A credit will be applied to your first invoice in the amount of $100, the equivalent value of the first year registration amount. valid in the Province of Ontario only, valid UCDA members and new Impact buyers only. 4 | THE Offer ONTARIO DEALER © 2017 Impact Auto Auctions Ltd., All Rights Reserved.
THE DRIVER’S SEAT These are exciting times at the UCDA! Ontariocars.ca is an entirely new way for people in Ontario to shop for a car. At least three things make the site different from any other vehicle listing site for the car-hungry consumer:
By Warren Barnard, Executive Director, UCDA
the ucda is launching its most ambitious member service ever: Ontariocars.ca. A year-and-a-half in the making, the new UCDA powered vehicle listing site launches in November. Ontariocars.ca is a vehicle listing website exclusively for UCDA dealer members to promote their vehicles to Ontario consumers without the clutter of curbsider listings and manufacturer advertising. Ontariocars.ca offers: • S yndication with other major vehicle listing sites and compatible integration with most DMS systems • A user friendly app for uploading dealer inventory onto the site • Exclusivity for UCDA members. Only UCDA members can list vehicles on the site. There are no curbsiders or other private sellers competing against UCDA member vehicles.
1. All in pricing on all vehicles. Since all sellers on the site are dealers, the all in pricing rules apply to every vehicle on the site; 2. For the same reason, any accidents or other important facts about every vehicle listed will be disclosed by the selling dealer before it is sold; 3. Consumers will never be duped by curbsiders on Ontariocars.ca… curbsider ads make up 25% or more of apparent private ads on many other sites. Ontariocars.ca was created to ensure consumers can shop for a vehicle, secure in the knowledge they will benefit from the protections provided by purchasing from a registered dealer and a UCDA member. Ontariocars.ca is the only online source where all these protections come with every vehicle listed on the site. To promote the launch of Ontariocars.ca, several contests will be run giving residents of Ontario a chance to win four driver-themed grand prizes, including an exotic car experience, an audio/speaker system, car mats, gas cards, and more! Consumers can enter for their chance to win by following Ontariocars.ca on Facebook and Instagram.
Ontariocars.ca is providing UCDA members competitive pricing (it’s FREE through the end of February!), fully funded marketing and advertising campaigns, syndication across all other listing sites, strong website SEO, easy to use mobile technology and no clutter, just UCDA member cars and trucks. Read more about this exciting new venture launched by the UCDA on page 45. HERE ARE SOME OF THE OTHER INTERESTING ARTICLES IN THIS ISSUE OF ONTARIO DEALER: Fleet/Lease/Rental Market Trends. An analysis of fleet, leasing and rental volumes on the retail side of the market and how they're impacting supply and prices in the wholesale market. Leasing Used Cars. Many dealers have not ventured into used vehicle leasing. Learn about the unique Challenges and Opportunities. Succession planning. Many family businesses fail to negotiate the transition and are sold either to pay taxes or because no one in the family is willing or able to take over. We’ll show you how to plan well. Big picture planning for your dealership. Those, who fail to plan, plan to fail. A look at what you can do to be more successful in the upcoming year and beyond.
VOLUME 5, ISSUE 4 | 5
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© 2017 SiriusXM Canada Inc. “SiriusXM,” the SiriusXM logo, channel names and logos are trademarks of Sirius XM Radio Inc. and are used under license. All other trademarks, service marks, images and logos are property of their respective owners and are displayed here with permission. All rights reserved.
6 | THE ONTARIO DEALER
EDITOR’S NOTE Hey, how do you like our new look?
By Gina Monaco, Editor
have you ever looked back at an old photo and said, “what was I thinking”? Yet what we wore and how we did our hair was typical of the times, but those styles are now out-of-date, all retro trending aside.
In designing the new look, we wanted to stay up-to-date with the changes in the industry and the magazine needed to reflect that change. We wanted to reenergize the magazine both internally and externally.
That also applies to The Ontario Dealer. It was clear on looking through past issues that it was no longer translating very well, in a high tech, high touch world. We thought it was time for a rebrand that reflects both the evolution of the magazine as well as our vision for the future.
We wanted to send a more positive message to our readership. We also wanted to reflect a new relationship with our advertisers, to be more effective as a marketing partner.
The Ontario Dealer is the official publication of the Used Car Dealers Association of Ontario (UCDA), established in 1984, and currently represents 4,900 dealer members, who are estimated to account for over 75% of the active dealers registered in Ontario. We publish quarterly and distribute to the membership of the UCDA, plus a select number of subscribers, for a total distribution of 8,200 copies, made up of 7,000 independent and 1,200 new car dealerships.
We looked at the feel of the publication and the content we deliver. We looked at how the publication ties into the objectives of the UCDA and also, at what you, the members need, to help you be more successful. Our promise to you is to keep understanding your needs and wants and what it means to be a UCDA member. We would love your feedback so email me at firstname.lastname@example.org
In each issue we write articles that are informative and relevant to the industry. Because the industry is changing, we thought we should make a change as well to help us navigate a future in the digital age.
VOLUME 5, ISSUE 4 | 7
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MEMBER’S CORNER ... "The Middle Managers" ... A dealer friend asked me a question a little while ago and I had a really bad answer for him. He was looking to promote a salesperson to a sales manager position and he wanted to know where he could send them for training. It was important to him that he should always promote from within, if possible, but he didn’t want the person to be trained from within. My answer was ... I didn’t know of any person or training company that provided what he was looking for.
By Bob Pierce Member Services Director
I felt really bad, I had no solution for the problem. No training for a position that is responsible for so much of the success or failure of the sales department of a dealership. They have to manage people, a task that I believe is the most difficult in any type of business. They have to be motivators, discipliners, coaches and a friend … sometimes. The position requires a person that is process driven, adapts well to change and in this industry, is quick to implement those changes. Our industry is heavily regulated and these people must insure that they manage their staff in compliance with numerous Provincial and Federal regulations including advertising, employment standards and registration requirements. I call this class of managers … “the middle managers”. They are the GSM’s, new and used car managers and yes, F&I managers. Agree or not, these people run the stores. Not counting dealer owners or GM’s, it is estimated
that there are as many as 8,000 “middle manager” positions currently in Ontario. In discussions here at the UCDA, with OMVIC and countless dealer owners it has been suggested that the majority of these “middle managers” have had little or no formal management training. They comprise the majority of the 15,000 registered salespeople, managers and dealer owners that have not taken the 2010 OMVIC certification course. And these are the people who run the stores. So I have been thinking … Some people would say I should stop thinking. A more cynical friend has told me that training for the “middle managers” is not necessary or wanted because these people are told what to do by the dealers and the GM’s and nothing will ever change. I do not agree ... A significant number of the calls we get from members are from middle managers who are stuck with a problem that they need help to fix. From issues about selling vehicles out of the province, on or off First Nations reserves, to customers that lied when their trade was appraised. These managers need more information, and want a place to go for training. That message has been echoed by most dealers I’ve talked to. We need to talk more about this ... and we will in the next issue of Ontario Dealer.
VOLUME 5, ISSUE 4 | 9
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THE LAW MATTERS The Dishonest Employee employee has stopped coming into work, is chronically late, disobedient, incompetent, lazy or suspected of some even worse conduct. For our readers that are employees, please rest assured such calls are very rare!
By Jim Hamilton Legal Services Director
from time to time dealers will call me looking for advice about employment law. I always warn members I’m not an employment lawyer, as the field is highly specialized, and a little bit of knowledge does not go a long way … it can actually be dangerous. You don’t call a plumber if you need brain surgery, so any dealer with a serious employee problem should seek expert legal advice. Having said that, there are some common themes that emerge in the area of employer / employee relations; common sense and guidance from the courts can be most instructive. At its heart, the relationship between employer and employee is grounded in a social contract, "you be good to us, we’ll be good to you". Do your job correctly and competently and we will pay you fairly, provide benefits and security. Usually, when a dealer calls me on this subject, it is because an
The dealer wants to end the employment relationship, but is mindful of whatever pitfalls might lie in wait. Employers are right to be concerned because firing someone for “cause”, as the lawyers call it, can often lead to lawsuits over what is known as “wrongful dismissal”. A recent Ontario Court of Appeal case helped shed some light on how the law might react if an employer fires an employee for just a single act of dishonesty, even when such an act by itself might appear minor. The case is called Aboagye v. Atomic Energy of Canada, and it is relevant to dealers because it arises in a work environment which is regulated, like our industry. Mr. Aboagye was offered a job as a specialist in industrial safety at Atomic Energy of Canada (AEC). The job offer was based on a standard form all prospective applicants fill out about themselves, and which warns the applicant to be fully truthful. In this security questionnaire Mr. Aboagye was asked if he was presently employed, he answered no. It turns out this was not an honest answer as he was employed. In any event, he got the job. Shortly after, AEC began receiving complaints about harassment directed at Mr. Aboagye. AEC began investigating and, in the course of this process, discovered he
had not answered the employment question on his security form truthfully. AEC proceeded to fire him for that reason. Mr. Aboagye sued AEC for wrongful dismissal. He lost. The Court of Appeal upheld the trial decision on the basis that this breach of honesty went to the core of the employment relationship. As the trial judge held, the dishonesty destroyed the trust that must exist between employer and employee. As a regulated industry, selling cars may not pose the potential security threat that nuclear power does, but issues of public safety, consumer protection and professional codes do come into play. This case does not suggest that every minor act of dishonesty will trigger a right to terminate employment. Dealers will still have to weigh, with their professional advisors, the severity of the misconduct against the ultimate consequence of firing someone. As I said earlier, it often comes down to common sense – did the act (or failure to act) go to the core of the employment relationship, causing it to breakdown so seriously, that it could not be repaired? Would a severe reprimand, suspension or warning letter suffice instead? Dealers might confront severe acts of dishonesty ranging from misappropriation of funds, to theft, fraud, or deceit that could justify immediate termination. This case might help guide a dealer’s decision making in that regard.
VOLUME 5, ISSUE 4 | 11
THE FUTURE OF DEALERSHIPS
By David Miller
WHAT DOES THE FUTURE HOLD FOR THE USED CAR DEALERSHIP ?
online purchases have become the norm. Perhaps, ten years ago, maybe even five, an online purchase was met with trepidation depending on the website. In a time of e-transfers and bank payments paid via mobile pictures, it would be hard to find someone under 70 who has never made an online purchase. You may not succumb to an online clothing sale, but what about paid-in-full hotel rooms or gift baskets? According to Statistics Canada, Canadian e-commerce sales have grown to $19.2-billion in 2016. As a result, an E-Tail Canada data survey claims that
12 | THE ONTARIO DEALER
67 percent of marketing budgets have shifted to a digital platform, and in 12 percent of those cases that shift has been by more than 50 percent. These statistics may not surprise, but one of Ontario’s biggest industries, the used car dealership market, isn’t receiving the same online craze. On one hand, it’s a need of the customer to further investigate the vehicle and see what shape it’s in and how well it drives. The other side, comes down to the ambiguous legislation currently in place for used car dealers.
According to OMVIC there is no law preventing a dealership from making online transactions, as long as it’s conducted in compliance with the Motor Vehicle Dealers Act (MVDA), the Code of Ethics, the Consumer Protection Act (CPA) and Sale of Goods Act.
would dictate to see the vehicle in person, investigate its paint job, its interior comforts and how it drives. However, in the age of information overload on the internet, if a consumer is willing to make a purchase online, is there a legitimate reason to stop them?
That statement can be interpreted in many ways, and seems to depend on what makes a dealership compliant or non-compliant, and finding that information is easier said than done. When speaking with Greg Carrasco, VP of Hyundai Operations, GTA, Phaeton Automotive Group, he believes a fullonline transaction with a ‘Buy It Now’ button doesn’t currently exist for Ontario dealerships.
There’s no stopping an individual from making a $30,000 jewellery or vacation retreat decision online? But why not a used car? Considering it’s a simpler negotiation process that may come with a Certified Pre-Owned program or with a warranty at the dealership level.
In an attempt to get further clarification, a communications representative from OMVIC stressed “the importance to reiterate that whatever the business model is, it must fully operate in compliance with all relevant legislation and regulations.” And perhaps, that statement alone represents why understanding the Ontario laws and the potential future of online used car sales at dealerships is muddled in mystery. “They’re providing a pretty lax interpretation of the requirement in the Motor Vehicle Dealers Act to operate only from a registered premises,” explains Warren Barnard, Executive Director, Used Car Dealers Association (UCDA) of Ontario. Before OMVIC explained the law, Barnard felt confident that the law didn’t allow a dealer to operate anywhere other than their registered business location, and that “the online buying model doesn’t fit with the existing laws in Ontario.”
“The car business is the only business where consumer buying patterns have leapfrogged the industry,” explains Carrasco. Carrasco, an operator of two Hyundai dealerships in Thornhill and Richmond Hill believes it’s not that the dealership networks are unable to sell vehicles online, it’s simply that they’re not allowed to. “For close to two years, we’ve been ready for online sales,” adds Carrasco. “Our Thornhill shop is already initiating 65 percent of its transactions for new and used cars online and that includes credit applications, negotiations, tradeins – everything except the contract. We just don’t have the ‘Buy It Now’ button to finalize the transaction; that’s the challenge we’re facing.” Barnard shares a similar view on the future of the used car buying experience.
“I think it’s coming and there’s no way to stop it. Younger generations are getting accustomed to buying things online, and I don’t see that trend reversing. It’s something consumers appreciate and want to take advantage of.” But Barnard does not believe that the online experience is for everybody. Rather, he projects a combination of the current brick and mortar system and online sales to be the future model once regulation catches up with technology. Implementing the system under current legislation may be the biggest challenge, but once complete, it will immediately aid remote buyers who are forced to travel afar. Finding ways to sell online Even though some dealerships are unable to sell used cars online in Ontario, cyberspace is typically where the shopping experience begins. The internet provides a plethora of information from vehicle specifications, comparisons and price range. “Ninety per cent of new and used purchases for us start online,” explains Eric Levitt, president and dealer principal, 401 Dixie Kia. “Buyers are doing their homework online prior to their dealership visit. They come in well informed and well armed to make sure they’re making the right decision.” But it’s not just the buyer who has to be proficient in the online world. Dealers have to be on top of lead generations and take advantage of the potential range of buyers the internet provides.
Is there an arena for online used car sales? There’s an argument to be made that the online used car dealership model isn’t the same as buying a pair of shoes, especially considering we’re talking about large variances between used vehicles. Logic
VOLUME 5, ISSUE 4 | 13
THE FUTURE OF DEALERSHIPS | DAVID MILLER
“If used car dealers aren’t fully committed to the online experience, they won’t be having much success.” “If used car dealers aren’t fully committed to the online experience, they won’t be having much success.” Levitt and Carrasco are trailblazers with new age media and are well prepared if the online shopping experience takes off. Levitt and his business partner and wife Katie Naughton have created “the Katie and Eric brand” that can be seen and heard on radio, TV and throughout social media networks; they even get their sales associates to send personal vehicle walkaround video messages to prospective clients with vehicle inquiries. Carrasco takes it a step further. He’s the host of the largest automotive radio show in Canada broadcast on AM640 in Toronto and has just taken a position as Global News’ Inside Automotive Expert. Those audiences along with his own YouTube and social media channels
14 | THE ONTARIO DEALER
account for 70 percent of traffic generation at his two locations. “You cannot be a one-trick pony in today’s world,” adds Carrasco. “It has got to be an organic combination of interactions that places you in an advantageous position to captivate an audience.”
where the entire purchase including trade-in, and financing can be conducted with the vehicle purchase delivered to your door without ever taking a step into the dealership. On top of that, if you don’t like it after five full days and 500 km on the road, it can be returned with a refund and no questions asked.
With so much attention paid to online, it only seems like a matter of time before legislation opens up. In the meantime, some dealerships such as 401 Dixie Kia have found its own way to appease online shoppers by passing bills of sales via email with scanned signatures to finalize the sale.
Zoom.ca is able to do this after being carefully evaluated by OMVIC. According to the Ontario regulator, Zoom.ca fits within the requirements of the MVDA, and they anticipate more online models being created to provide more opportunities for dealers.
“We don’t get too many online sales, but if someone wants to make a purchase that way, we’ve done it before,” explains Levitt. “As long as they print the PDF, sign it and scan it back, we can staple that to the original bill of sale and the transaction is complete and legal according to OMVIC.” Exception to the rule Levitt might take on the odd fully-online sale, but a company called Zoom.ca, part of the Performance Auto Group has taken that to the extreme as the first online-exclusive virtual used vehicle store in Canada. Zoom.ca has been in operation since October 2016 and follows a similar format to Carvana in the United States,
With restrictions, come disadvantages There are pros and cons when comparing a used car purchase from a dealership, third party company, or private individual. In most cases, the biggest advantage in choosing the latter two comes down to price. Spending a little less can be a sacrifice in security, but at least the buyer has the option. Additionally, the online model caters to the online buyer, who would rather make a quick transaction, eliminating any negotiation and interaction until delivery of the vehicle. The dealership model holds its own on security and reliability through
certification and warranty, and that can be a priceless service that puts clients at ease when the alternative option is ‘buyer beware.’ In order to combat a potential steady online push in coming years, it would make sense to have dealerships given the same fighting chance as third party companies such as Ebay Motors and Kijiji. “If a traditional dealer is restricted in a similar business model, that is not fair, it’s a definite disadvantage,” adds Barnard. From the dealership level, Carrasco feels he’s already setup for online purchases without any need for additional infrastructure. He’s simply waiting for the go-ahead. “The very industry is sabotaging itself by allowing massive retailing organizations as third parties to bypass an archaic business model where you can leave a deposit, but not complete the full transaction.”
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At the same time, Carrasco understands that changing legislation takes time with a lot of work being done behindthe-scenes to obtain licenses and facilitate “significant and necessary changes.” What will the future look like The online shopping world may be at an all-time high without any signs of regress, as traditional brick and mortar shops cling to stay on. But the used car dealership world doesn’t follow the same pattern; it’s a different animal altogether that’s starting to see a gradual change in its business model towards an online dealership network. Carrasco and Levitt enjoy interacting with customers, and do it quite successfully. Their thoughts as to online are simply for a fair fight versus third party companies in a business model that’s evolving at a rapid pace. Additionally, Levitt believes one helpful solution to fight the trust stigma that dealerships face is a 30-day used car sale with "no question asked" exchanges, whether online or sold at the physical dealership. No matter who you ask from the regulation body to industry experts, the potential growth of online used car sales at the dealership level is there. Barnard sees both physical and online choices being the future, but with a gradual rollout. Even though, the online-experience currently exists at Zoom. ca, he sees it as a start, but not the norm, for a while. But before anything can change the first order of business is clearing up legislation. Barnard hopes the transition will be conducted in an orderly fashion with the same level of protection and interpretation of legislation for all dealers, large or small. If done properly, a fair marketplace would be the result along with a great opportunity of options for consumers.
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www.bairdmacgregor.com VOLUME 5, ISSUE 4 | 15
TRENDS | CHRIS CHASE
TRENDS By Chris Chase
THE COLOUR OF MONEY when stocking your dealership’s lot, it’s important to look for vehicles you know will be easy to sell. But while I’m sure you already keep your eyes open for specific types of vehicles, like the SUVs and crossovers that buyers tend to favour at the moment, how much attention should you pay to the colour of the vehicles you bring home from the auction? The answer is: more than you might think. While it’s easy to think of newvehicle buyers having all the power in choosing the colour of their next vehicle, a recent study shows that used-vehicle buyers can be just as picky about the paint on their new-to-them vehicle. The data comes from a used-car
16 | THE ONTARIO DEALER
research company called iSeeCars, which publishes an annual study to find out which vehicle colours are most popular among male and female used-vehicle buyers. In 2016, for its fifth annual study, iSeeCars analyzed 700,000 inquiries on its website and nearly 30 million used car sales to see which colours each gender showed a preference for. Their findings revealed some notable trends.
Among this year’s revelations is that teal is back in a big way among female buyers who, in recent years, have tended to prefer neutral shades like gold, silver and beige. Teal enjoyed a brief period of popularity in the 1990s before fading into relative obscurity, but now women apparently prefer it 19 per cent more than men do. That’s a significant change from the year before, when it was more popular among males.
For the first time in iSeeCars’ research, green cars were favoured by women, albeit by a slim margin of 4.3 per cent. Meanwhile, men stuck with their standbys, preferring yellow and orange vehicles to any other colours 33.9 and 32.6 per cent more than women, respectively. Black and brown also ranked higher among male shoppers. iSeeCars then looked at what types of vehicles men and women were looking for and determined that men preferred pickup trucks by a margin of more than 200 per cent, and searched for and bought convertibles and coupes more often
than women. Meanwhile, females showed a preference for SUVs, and investigated used minivans more often. The corollary is that by looking at both colour and vehicle preferences, iSeeCars said men demonstrated more expensive and aspirational tastes, with prices for cars painted in colours preferred by men averaging more than $18,000, while the shades women like more averaged just under $15,000. The difference was even more stark when looking at each gender’s top-ranked colour: The average price for yellow cars was more than $20,000, while teal vehicles were priced to an average of just over $11,000. But while men may be spending more than women on used vehicles (or at least fantasizing about doing so), another recent iSeeCars study shows they’re not necessarily throwing that money away.
In an analysis of resale values, yellow and orange cars showed the slowest rate of depreciation out of a dozen common vehicle colours. Meanwhile, neutrals like silver, beige and gold, which women tend to like more, all depreciated at a rate faster than the three-year average of 29.8 per cent. Those conclusions run counter to assumptions that bright colours are more polarizing on cars and can make it harder to sell a car. iSeeCars said that can be attributed to the fact that there are fewer brightly coloured vehicles available, but also enough demand for them to drive values well above those for more common shades. So never mind the assumption that used vehicle buyers don’t care what colour vehicle they end up with. Instead, by paying attention to trends, you could paint your dealership’s lot the colour of money.
VOLUME 5, ISSUE 4 | 17
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18 | THE ONTARIO DEALER
WHOLESALE MARKET ANALYSIS | CHRIS CHASE
WHOLESALE MARKET ANALYSIS By Chris Chase
WHAT YOU NEED TO KNOW ABOUT THE WHOLESALE MARKET
this is shaping up to be an interesting year for used-vehicle sales in Canada: the value of the loonie is up, consumer confidence is high, new-car sales are on track to top two million for the first time in history and leasing is continuing its comeback â€” and all of these factors are triggering a drop in wholesale values on the used-vehicle market.
VOLUME 5, ISSUE 4 | 19
WHOLESALE MARKET ANALYSIS | CHRIS CHASE According to data from the Organization for Economic Cooperation and Development (OECD), the Consumer Confidence Index (CCI) spiked to a 10-year high in mid-2017. That’s almost certainly driving a nearly 8 per cent increase in Canadian retail spending in July 2017 compared to a year earlier, with usedvehicle sales outpacing that number with a 9.7 per cent jump year-over-year. It’s no surprise, then, that Canada’s economy grew by 4.5 per cent in the second quarter of 2017, the best performance of any G7 nation. While you’d expect that such strong economic circumstances would translate into continued increases in wholesale values for used vehicles, they are actually on a downward trend that can be attributed to a number of factors, some of which are tied into that economic high we’ve been enjoying in recent months.
of Research and Editorial at Canadian Black Book, said has diminished the appetite of dealers looking to export cars to the U.S. and started a downward trend in wholesale values. “The interesting thing about the exchange rate is that, unlike other things that would change the market, like shifts in consumer tastes, the exchange rate changes every minute, so it’s always a variable,” said Murphy. “That (cross-border) activity’s still taking place, but we think that’s going to slow down.” According to Murphy, the exportation of vehicles to the U.S. slackens off when the Canadian dollar approaches 84 or 85 cents U.S.
The strength of the Canadian dollar continues to be one of the driving forces behind wholesale vehicle prices in this country, but the story is a bit different than it was when we covered the state of the marketplace in 2015 and 2016.
“The dollar has been flirting with that (recently) and we are starting to see some slowdowns, so that’s going to be interesting to watch,” said Murphy. “We watch the dollar quite closely because it doesn’t only figure into wholesale prices; we do residual value forecasting here, and it has a bearing on that too.
At the beginning of 2016, the dollar was trading at about 70 cents on the U.S. dollar, a situation that attracted a flood of American used-vehicle dealers north of the border to take advantage of their increased spending power. That caused a spike in wholesale values for the vehicles those American buyers were looking for, mostly trucks and SUVs.
“The other thing to bear in mind is that for regulatory reasons, when you export a car to the U.S., it has to stay in a 30-day hold … when you ship the vehicle, it’s 30 days before you can get it to market to get your money back. Fluctuations in the dollar and sitting on that car for 30 days also figures into people’s appetite for how much they’d like to export the car to the U.S.”
But by the beginning of September 2017, the loonie was valued at a little more than 82 cents and settled at around 80 cents in the following weeks, which Brian Murphy, Vice-President
20 | THE ONTARIO DEALER
Tom Kontos, Chief Economist for ADESA Analytical Services, said the current downturn in values can drive a short-term boost in profits for used dealers.
“In the short run, there can be some mismatches between what a consumer thinks a car is worth and what the dealer knows the car is worth,” said Kontos. “In the short run he can probably profit from being able to buy a car for less, and the retail market hasn’t necessarily baked that into the expectation that a consumer would have on what to pay for the car.”
“ In the short run, there can be some mismatches between what a consumer thinks a car is worth and what the dealer knows the car is worth.” But he said competition tends to cause all of that to be very short-lived. “If you try to get too much for the car based on what it was worth a month or two ago, somebody else down the road’s going to try to get what it’s worth today and mark it up at a more reasonable level. Competition’s probably the biggest driver as to why those profits are only short-term.”
“It depends whose numbers you believe, but those two hurricanes gobbled up more than 700,000 cars,” said Murphy. “Those will have to be replaced, and one of the possible pools of replacement vehicles is the used-car market in Canada.” But Murphy said the extent of the storms’ effect on our market won’t be seen immediately, as it will take some time for insurance companies to process the massive number of claims for destroyed vehicles. Increase in leasing activity More immediate is an uptick in leasing across Canada, which Murphy says has doubled in popularity since 2010 to account for around 27 per cent of new car sales, a figure bolstered by data from insurance company RVI Group, which indicates leasing was up 22 per cent in May 2017 compared to a year earlier. And though leasing is still way down from where it was before the 2008 recession, the increase in three- and four-year terms popular among lessees is making it easy to predict when those vehicles will come back to dealers and, consequently, when those dealers can count on adding them to their used-vehicle inventory. Between the continued rise in leasing’s popularity and Canadian new car sales overall, Kontos said used dealers
Uptick in new vehicle sales Canada’s healthy economy is also very likely the main thing pushing new vehicle sales toward the two-million mark for 2017, a figure Brian Murphy thinks is “interesting” because industry analysts were expecting sales to flatten out after records set in the past few years. “I don’t believe that the market’s sustainable at that high number over a long period of time, unless consumers are fundamentally changing their purchase behaviour, which we don’t really see happening,” Murphy said. “I think the upper boundary is a number less than two million. Our industry’s terribly cyclical, so lots of folks are just wondering if this is the top of the cycle.” While the strength of the Canadian dollar tends to be the determining factor in how many U.S. dealers come north to buy vehicles at auctions here, the wildcard in the next few months will be the fallout from Hurricanes Harvey and Irma, which struck Texas and Florida in late summer. While the real tragedy of these storms was the loss of life and destruction of homes they caused, damaging winds and flooding also destroyed a lot of cars and left large numbers of people in need of new transportation.
VOLUME 5, ISSUE 4 | 21
WHOLESALE MARKET ANALYSIS | CHRIS CHASE could see wholesale values continue to fall in the coming three to four years, as today’s new-vehicle buyers begin to return those leased cars and trucks and trade in those they’ve bought through financing programs. “I was even thinking we might see some of that this year, but it hasn’t really materialized as far as I can tell,” he said. Kontos said some buyers who had to finance over 72, 84 and 96 months when leasing wasn’t an option in the wake of the recession are still “upside down” and have to delay trading their cars in until they build up more equity. “Even though I said people would want to turn a car in after 4 years, if they’re upside down and they can’t really swing the negative equity, they have to make payments for another couple of years,” he explained. “Used-car supply is still pretty tight here in Canada, and won’t recover for a little while longer.” Wholesale values down RVI Group’s data backs up both Murphy’s and Kontos’ predictions that the downward swing in used-vehicle wholesale values is here to stay. Between the uptick in leasing and the stronger Canadian dollar, the insurer thinks usedvehicle values will decline as much as 9 per cent between now and 2020. The most significant declines will come in the small pickup (12.6 per cent), small luxury sedan (12 per cent), full-size SUV (10.8 per cent) and full-size luxury sedan (10.5 per cent) segments. That kind of significant drop is raising questions of whether we’re on the verge of an automotive marketplace bubble like the one that led to the subprime mortgage crisis in the United States. In early 2016, Maclean’s magazine published an article that explored whether the cheap new-vehicle financing rates and longer repayment terms that became popular post-recession were harbingers of such a phenomenon. In that piece, Maclean’s cited Financial Consumer Agency of Canada concerns that too many car buyers were trading in vehicles before they’d built up any equity in them and simply rolling their existing debt into a new loan. Kontos said he gets a lot of questions about this topic from reporters looking to get a scoop on the next “big short” that in theory could result from an overabundance of subprime auto loans. But he doesn’t think that situation is likely to lead to the “same kind of ramifications that we saw in the housing market,” mostly because lenders learned a hard lesson from that experience.
22 | THE ONTARIO DEALER
“Canada’s exposure to 96 and 84 month loans is actually probably greater than in the U.S., but I don’t think those are necessarily subprime and high-risk,” he said. “I think it just affects what new car demand’s going to be like, because people won’t really be able to get right-side-up.” Kontos said the difference in the auto industry is that unlike with real estate, “People expect cars to depreciate. Lenders who felt there was less risk to their lending strategy dealt with the subprime mortgage crisis, and they don’t want to repeat that kind of a stupid mistake.” Kontos said that as an economist, he watches loan delinquency and default rates as one means of predicting the volume of vehicles his company can expect to sell at auction at any given time. “I’ve noticed a bit of a rise in delinquency rates, but I’ve actually seen a decline in default rates,” he said. “They’re all very subtle movements—they’re not dramatic—and that tells me that lenders are saying, ‘I’ll let you go 60 days without making a payment and I won’t repossess the car.’” Kontos said that even if auto loan defaults rose, it wouldn’t bring down the whole system the way housing did, for a number of reasons. “The market itself isn’t anywhere near as large dollar-wise as the mortgage market is,” he said. “And then you don’t have the ability to liquidate the house almost instantaneously …You send a car to the auction, and in several hours you’ve got your money. (There’s) the ability to recover as much of the unpaid balance as you can as a lender through auctions, and it’s a car, too, you can move it, you’re not stuck with selling something as is, where it is.” Once again, it seems patience is a virtue if you’re a used vehicle dealer waiting for it to get easier to find vehicles to sell.
CANADIAN AUTOMOTIVE MUSEUM as part of the british empire, wealthy Canadians imported luxury cars from Great Britain for use in Canada. British cars in the Canadian Automotive Museum highlight both the vehicles and their Canadians owners.
ADDITIONAL BRITISH VEHICLES
The Canadian Automotive Museum is open year-round and offers complimentary parking in downtown Oshawa. With a variety of local attractions, restaurants and cafés within walking distance, the Canadian Automotive Museum is a great day trip from downtown Toronto. Visit:
• 1912 Wolseley • 1939 Rolls-Royce Wraith • 1952 Vauxhall Wyvern Station Wagon • 1960 Rolls-Royce Phantom III • 1983 DeLorean DMC-12 • 1988 Rolls-Royce Silver Spur LWB
VOLUME 5, ISSUE 4 | 23
DEALER PROFILE Foster Auto By Lori Straus
Finding a Niche Helps Compete with Major Used Car Retailers foster auto group sells predominately volkswagen, but it’s not an oem dealership: It’s a bona fide independent dealer that found a niche no one else in the surrounding markets was filling. Husband-and-wife team Jerry and Joan Foster opened up Foster Auto Group 34 years ago. "We were just general used car operators,” says Jerry. They only had a handful of vehicles on their lot at that time. In fact, their inventory was so small they would park all their vehicles in their home driveway for the 18 or so days they were away on March Break vacation. continued on next page
24 | THE ONTARIO DEALER
VOLUME 5, ISSUE 4 | 25
Foster Auto “It was just this little rinky-dink office; it was about as big as a desk,” Jerry says. So, moving the vehicles to his and Joan’s house was necessary for security. They’ve moved several times since. The next property had room for 20-30 cars, their third location about 35. At their current location, Dundas St. E. in Waterdown, they have on average 40-45 vehicles on their lot at any given time. However, it was at that third location that Jerry thought to specialize in selling only used Volkswagens. Moving to Volkswagen Jerry has always loved Volkswagen, and that fed his decision to focus on this niche. Another factor, though, was how to position himself as a small dealer in the midst of much larger ones. "JP Motors here in town stocked 300, 400 cars. Autopark, another big reseller of used cars. Haldimand Motors out in Cayuga, [also] in my trading market,” he explains. “Now, I can't compete on their level. I don't have the room for 400 or 500 cars, and I don't have the money for 400 or 500 cars. But I do have the room for 45 Volkswagens, and they don't have 45 Volkswagens. As a matter of fact, they probably don't have 45 Volkswagens between all of those large resellers. " The problem Joan saw, though, was acquiring enough cars to claim that territory. As Jerry told the story, Joan’s concern was with turnover: even if they acquired three Volkswagens, they would likely sell those before they found another three. To secure enough vehicles so they could specialize in one make, Jerry
26 | THE ONTARIO DEALER
knew they’d have to go to the auctions. However, the Fosters had had difficulty with those in the past. “You know, auctions are a tricky place, and you have to pay attention, you have to have a little bit of knowledge, and you have to know what it is you're looking at,” Jerry says. In his experience, you sometimes have only 15 seconds to look at a car and decide if you have the money to buy it or if you’re going to leave it. Bumps in the Road The downside with specializing in one make, though, is dealing with major recalls. In the case of Volkswagen, it was the diesel issue. Jerry admits this was a rough time for the family business. “We had lots of diesels,” he says. “It was really difficult to sell the diesels. You could legally sell them with the disclosure that there was a known problem and that Volkswagen was going to have to address the problem at some point in time down in the future. But it still made it very, very difficult, and it was a real rough six months." Flexibility is key when dealing with tough times, and Jerry knew he needed to expand his offerings. However, even here he remained focused and took predominantly European and Japanese makes, and almost never American: "If [American] finds its way on the lot, it's a trade-in from one of my local dealers I do business with. You kind of help them out and put a deal together with them." Quality Vehicles Foster Auto Group is run by only five people: owners Jerry and Joan, son Mike, daughter Ann, and nephew Paul. Joan, Jerry, and Mike are buyers, and although Joan and Jerry sell less often
L to R: Nephew Paul, son Mike, daughter Ann, Joan and Jerry
than they used to, Jerry believes working as both buyer and seller gives the dealership a slight advantage over ones who separate the roles.
The family also doesn’t work on commission, so whoever’s available looks after the customer who’s just walked in. In the end, no commission means no competition among sales staff.
Why? Because they have to sell what they buy, it gives them extra insight into what will actually sell on the lot. And since Foster Auto Group focuses on high-quality Volkswagens, that’s what they search for.
Looking After Repairs
For example, when deciding on a vehicle at the auction, they’ll look for the vehicle’s service book and call the service team of the last entry in the book. (Sometimes this isn't possible because the book isn’t always stamped.)
The Foster family never had a garage on site to conduct repairs and inspections. Not including a garage wasn't an active decision, Jerry says. They would've liked to have had one, but with a 4,000 sq. ft. office and a small showroom, there wasn’t room for anything else.
Instead, he’s built a small network of trusted repair shops he can use. There are a few local ones, another one in Customer Service Hagersville for specific Volkswagen problems, and one in Cambridge for 4th generation models (07/08 and older). The Foster Auto Group website says, “Our used car dealership "He can diagnose the car almost on the phone, because he's has been working to change the image of the used car industry seen so many of them, and he's very efficient at getting them for over 34 years. Our goal is to improve the used car buying done. [The car’s] done in a day and back on the lot ready for experience for each driver that visits our family-owned and sale,” Jerry says of the Cambridge repair shop. operated dealership.” It Works “It's not easy to do! You know, it costs money,” Jerry says with a laugh. Foster Auto Group has been in business for 34 years now. A healthy mix of quality, niche inventory, excellent customer Customer service is one pillar in this goal, and it doesn’t service, and a strong network of repair shops has helped appear to be a very complicated matter for the family. He says, the Foster family build an independent dealership despite "It's mostly how we look after [our customers] after the fact." competition from the nearby larger lots. For example, even though their warranty is for 30 days, 1,000 km, and 50/50 fix, if something appears that Jerry feels the Jerry says, "Almost every day, we see somebody here that we dealership should have caught, he’ll have it fixed. sold a car to or that their brother bought a car from, or their neighbour bought a car from us, or somebody told them we're This way of working with customers may sound expensive, good people to deal with." but Jerry says it generally isn’t: “Part of the reason we don't have huge after-sale costs is because we're a little more careful There can be no higher compliment than that. about what we buy.”
VOLUME 5, ISSUE 4 | 27
WORKPLACE SAFETY | JIM HAMILTON
WORKPLACE SAFETY By Jim Hamilton
THE SOCIAL “CONTRACT” with the dawning of the 20th century came the realization that the workplace could be a dangerous place. Probably more so in 1900 than in 2017, but this is when the world starting thinking about employee safety. Following a wave of social change, Ontario introduced a bargain in 1915. In exchange for an employee giving up their right to sue an employer for workplace injury, the government established a scheme called “workers’ compensation”. As the name implies, the idea was to financially assist an injured worker who was expected, with that support, to heal and eventually return to active duty.
28 | THE ONTARIO DEALER
In Ontario, from its origins, the program has evolved to include:
no-fault insurance for Ontario workplaces”.
• Loss of earnings benefits
As mentioned earlier, the system is based on a bargain of sorts. The employee gives up the basic common law right to sue and, in exchange, employers pay premiums to obtain workplace insurance, which means different things to workers and to employers.
• Support getting safely back to work, adjusting duties or retraining • Coverage for health care costs • Safety and Preventative Measures Education to prevent workplace injury The Workplace Safety and Insurance Act, 1997 governs the workplace safety and insurance system in Ontario. The Workplace Safety Insurance Board (“WSIB”) is responsible for enforcing the Act. The WSIB describes itself as “an independent trust agency that administers compensation and
What do employers get out of it? Well, they generally don’t need to worry about being sued by employees. They have workplace insurance they can rely on. The WSIB works by providing guaranteed no-fault workplace insurance that protects them from costly court settlements and provides services and support when needed.
Education and Training The expectation is not that everyone will go on their merry way thinking all is well now that we have insurance to cover injuries. Employers and employees are required to take an active role in ensuring safety. This expectation finds expression in another piece of legislation governing this area, the Occupational Health and Safety Act. There are mandatory aspects to this legislation for both employers and employees: • Health and safety awareness training • First aid equipment and trained workers in all workplaces • Display the WSIB “In Case of Injury at Work – 1234” poster, near your first aid station. You can download
a PDF version of the poster (PDF), while you wait for your printed version to arrive in the mail.
not have a clearance number, the dealer could be responsible for paying premiums and possible penalties.
• Display the mandatory “Health and Safety at Work: Prevention Starts Here” poster. You can download this poster from the Ministry’s Health and Safety page
To confirm the validity or status of a clearance number, dealers can visit the WSIB website and enter the clearance number into the site, to see whether or not it’s currently valid.
Some dealers are not aware of all the implications of these important pieces of legislation. Obviously, it affects internal operations, but it can also impact areas that may not be immediately apparent. For example, almost everyone in the construction industry needs a WSIB clearance number, unless the work that is being done is home renovation work.
Dealerships need to think about employee safety; no one wants to see people getting hurt making a living. Many dealers have repair facilities, work with chemicals, machines and equipment that can cause injury if care is not taken. There are plenty of supports out there for dealers to learn and stay on top of this important area of Ontario law.
This includes anyone hired by a dealer, even if being paid through a contractor or sub-contractor, to perform construction or renovation at the dealership. If the worker does
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VOLUME 5, ISSUE 4 | 29
PLANS FOR SUCCESS | LORI STRAUS
PLANS FOR SUCCESS By Lori Straus
When You Plan, Don’t Just Stay in the Forest
30 | THE ONTARIO DEALER
planning can be hard and easy automotive business for over 30 years. at the same time. It can be euphoric He garnered his experience in the UK, (“We’re going to increase sales by 20% Canada, and the US. His company also this year!”) and depressing (“We need operates Auto Careers Group and Right to find space for the service department Fit Plus. He has been involved in over while we renovate its current location”). 65 dealer transactions, has placed over No matter your business, whether an 1,000 job candidates with dealerships, OEM or independent dealership, you and is a guest speaker at OEMs like have to plan. But as you carry out your Chrysler Canada and Porsche Canada. plans, do you find they’re indeed effective, i.e., do they help you accomplish your He says, “Be realistic, be consistent, and goals? Or do you frequently scramble to know your people. Those would be the readjust them because “things happen”? three pieces of advice I’d give a dealer in planning.” The Experts Easier said than done, of course, but if done well, you could be reaping more Farid Ahmad, CEO and founder of Dealer benefits than you thought. Solutions North America, has been in the
John Latka, founder and CEO of Automotive Business Solutions, says he is currently working with dealerships who have closing rates of 50% or higher. “Most people say, ‘You guys are on drugs. That can’t happen.’ But it’s happening,” he says. Latka, too, has over 30 years of experience in sales and management, and has managed dealerships in Hamilton, the Greater Toronto Area, Ottawa, and Halifax, where he now resides and operates from. So: What’s the deal with successful planning? (Pardon the pun.) It comes down to actionable items and data. Leave Your Gut out of It “Gut feeling” has achieved an odd honour as a to-be-trusted method for making decisions. It’s very likely that it’s worked for you once in a while, but Ahmad says it’s not the go-to solution for planning. “Their gut tells them this is a good plan, because they’re basing it on past experiences, but really, what they should be doing is enough research to ensure that what they feel is gut-wise the right thing to do, is actually going to get accomplished.” Ask questions such as these: How many vehicles do you have on the lot? How many people walk through your doors? How many people need to test drive a vehicle before they buy it? “You need a plan that’s executable, but it’s based upon facts, not best gut feeling,” Ahmad says. Latka is a strong believer in key performance indicators, or KPIs. He advises his customers to measure daily several events during the sales process: the number of walk-ins, appointments booked, customers who actually showed, proposals for sales and/or financing offered to customers, appraisals completed, and closed deals. “So, all these factors are taken into consideration,” he explains, “and we
have percentages associated with each one of those as minimum standards. And those hitting those minimum standards are closing in the 50% range.” Surprisingly, though, in his sales workshops, Latka still finds that salespeople don’t know their actual performance data. “So the thing is, Yogi Berra once said, ‘If you don’t know where you’re going, you’ll end up someplace else.’ Because we’re not focused on the plan or direction.” Latka illustrated this tracking using the following small car dealership that signed up with his company on June 1st. These were their closing ratios for that month: BEGINNING OF JUNE • Appointments: 48.1% • Walk-ins: 18.6% • Overall: 37.7% END OF SEPTEMBER: • Appointments: 62.7% • Walk-ins: 34.7% • Overall: 52.7% The team of three sales consultants, plus management, sold 39 new and 20 used cars, one more than planned. One consultant had joined the dealership right on June 1st, and another not until mid-August. Latka also had software developed to help salespeople track their day, which therefore helps managers track their performance.
appointment for the customer to return if needed. Drop-down menus help a salesperson quickly enter in the make and model plus, a few other descriptors. Once you have your plan, though, it can become tricky to implement it. Ahmed says, “Planning for success is also committing yourself to execution of your own plan. Many people set up the plan, and they have no idea how to execute it.” He finds that the top-performing dealers are the ones who consider all aspects of their sales plan. It’s not enough to set a goal of selling, say, 100 vehicles. Dealers need to ensure that they have the right number and mix of cars on the lot to hit that goal, carry out enough advertising, and provide solid training for the sales team. Plans for Sales Staff Now comes the detailed work, the actionable items: setting sales goals for each member of your sales team. Whether the manager assigns each salesperson monthly goals or the salespeople choose their own, these goals must be realistic. Latka considers each salesperson’s tenure at the dealership, their skill set, past performance, and if they’ll be away from the office for any length of time, e.g., for vacation, when setting that individual’s sales goals. Then, dealers need to track each sales rep’s performance on a weekly and even daily basis. “If a salesperson has yet to sell a car by mid-week Wednesday, then the management team has to sit down with that individual,” he says. Management needs to review what the sales rep has been doing, whom they’ve been talking to, how far along they are with any prospective customers, and then try to put a deal together.
He says his software is easy to use and takes 30-45 seconds to fill out the form on any device, including your smartphone. “Each individual member of the team The salesperson enters only the needs to be responsible for a portion of customer’s name, contact information, that plan or goal,” he says. chooses whether the person is a prospect, walk-in, or appointment and can set an
VOLUME 5, ISSUE 4 | 31
PLANS FOR SUCCESS | LORI STRAUS In addition, Ahmad says, to achieve that, you need to help your sales staff understand what their capability is. Take, for example, this hypothetical situation: a salesperson knows she sees 1.5 people per day on average, has a closing rate of 11%, but wants to sell 12 cars this month. Will her goal be reachable at her current closing rate? Assuming 20 workdays in a month, she’ll see 30 people and likely only sell about three cars. It’s clear she won’t sell 12 cars unless something changes. This means she’ll need to prospect, which means putting together a plan of actionable tasks. It’s not enough that she knows her closing rate is too low, or that she “has to prospect.” “Must prospect,” according to productivity guru David Allen, is not an action. “Call 5 previous customers tomorrow” is. Monthly sales goals are a must for each sales rep, and Ahmad suggests that managers meet with each salesperson a few days before month end to discuss next month’s goals.
He says it’s a mistake to wait until the beginning of the month, because if everyone’s busy, and then a long weekend shows up, and it’s part way into the new month before the meeting for that month happens, salespeople tend to miss their quotas. In the end, you need to hold your sales teams accountable for their performance.
can contribute to achieving dramatic results in terms of increased volume and profitability. Get Everyone Involved Latka worked with a dealer once who sold about 800 cars a year. He planned with management and declared a goal of 1,000 vehicles for the coming year.
“You shouldn’t be in business if you’re not prepared to measure.”
“They looked at me like I had three heads,” he says.
Accountability may be the key that turns on the engine, but what exactly does that mean? It’s not just about following the map, it’s about keeping an eye on the dashboard and tracking its readings.
Each sales rep committed to selling three to four additional cars per month.
“You shouldn’t be in business if you’re not prepared to measure,” Latka says. In all his years of experience, Latka has seen how improving accountability
However, he then met with each sales rep to collect their input. He asked them, “Last year, here’s what you’ve been able to do per month. What do you think you can increase that by with our on-going help and support?”
What happened? Latka says that even though management backed off a little about three-quarters of the way through the year, the dealership still sold 965 vehicles.
photosbypierce.com 130 Industry St., Unit 36, North York, ON M6M 5G3 e email@example.com www.photosbypierce.com
32 | THE ONTARIO DEALER
“However, when you take a look at the increase percentage-wise, that was pretty huge. The next year, we did 1,135.” Ahmad says it’s also important to make sure you have the right people involved in executing your plan. He finds that, all too often, dealers involve people in creating the strategy who aren’t actually qualified to do so. “If you’re going to create a plan, and you want to execute a plan, you’ve got to make sure that you’re engaging people that have the skill set capable of executing that plan,” he says. One weak area he frequently sees is training, which Ahmad says is not necessarily a manager’s job. Training should not be underestimated: it’s a skill that rarely comes naturally to people. In other words, it’s one that needs to be learned. Ahmad says that just because a manager is a manager, doesn’t mean they necessarily know how to train sales staff. “Just because the manager is good at selling cars and negotiating deals does not make a trainer. He may be able to train
on closing, but he may not be able to train the sales people from A to Z,” he says. Ahmad explains that the typical cycle looks something like this: Internal managers who cannot train well train sales reps ineffectively. The reps then don’t sell well, and the sales manager gets blamed for not training. But here’s the catch: they did train the team, and they can show their own managers how they trained their team. Unfortunately, these sales managers get fired anyway. “So, I don’t believe that dealerships should try to save money by not engaging with a professional training company,” Ahmad says. What’s Next? Allen, creator of the Getting Things Done system, writes that the biggest question anyone needs to ask when trying to carry out a plan is, “What’s the next action?” Because, after all, a plan is nothing if it doesn’t get carried out.
WHAT SUCCESSFUL DEALERS DO: Farid Ahmad CEO AND FOUNDER,
Dealer Solutions North America
• Consider all aspects of a retail sales plan. • Understand the dealership’s traffic management. • Calculate and monitor salespeople’s closing ratios. • Request a sales plan from each individual salesperson. • Review the sales plan 3-4 days before the next month.
John Latka CEO AND FOUNDER,
Automotive Business Solutions
• Hold each team member accountable for his or her plan. • Monitor key performance indicators. • Set minimum standards for performance that must be met.
VOLUME 5, ISSUE 4 | 33
TECH TALK | ANGELA WEST
TECH TALK HERE’S THE LATEST ON WHAT’S HAPPENING IN AUTOMOTIVE GADGETS AND APPS 34 | THE ONTARIO DEALER
By Angela West
capture high definition google street View photos from your car Chances are over the last few years you’ve seen Google’s Street View cars driving around your area - with Insta360’s new Pro camera, you can capture your very own own Street View pictures! The Insta360 Pro is certified for the “Street View Ready” program launched by Google this past May. The camera can take 360-degree photographs with resolution up to 8K in full 3D, meaning that it meets Google’s own Street View standards.
finally be able to get some much needed attention - with pictures taken by the folks who know these areas the best. The Pro camera is perfect for capturing the beauty of rural areas not covered by Google’s own Street View cars. The Insta360 can be fixed right on the top of your car, with photos being processed through a desktop app called Insta360 Stitcher, and later uploaded to Google servers - you could be seeing your own photos on Google Earth, Street View, or Maps after just a few short weeks of picture-taking.
This new line of Google-approved cameras will mean the areas not covered by Google Street View will
YOU CAN FIND OUT MORE OVER AT: www.insta360.com
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Now in its second generation, FIXD is hailed as being an inexpensive and easy-to-use solution to finding out the health of your vehicle. It comes in the form of a USB that plugs right into your OBD-II port - found in most cars made since 1996. From there,
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We regularly assist Ontario dealerships with: • • • • • •
Advertising • OMVIC registration, licensing Commercial Leasing and compliance Employment Law • Proposals to Refuse and Licence Appeal Tribunal Matters Proposals to Revoke Litigation • Provincial Offence Act charges Mechanic’s and Storage Liens
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TECH TALK | ANGELA WEST combination for a memorable road trip. The new features allows users to navigate within Waze from their Spotify app and vice-versa, giving access to Spotify playlists right from Waze. Your Spotify app will be able to determine when you’re driving or in your vehicle through its Bluetooth connection. The partnership means that you’ll be able to select and change songs without having to leave your Waze app - you’ll never have to worry about losing your way or drive while distracted. Once your vehicle comes to a stop, you can swap between the two apps without interruption, letting you select whichever one is most useful to you in the moment. The app will ensure your music is turned down when delivering directions, meaning you won’t have to worry about the music being louder than your navigation app. The partnership has been crafted with both safety and having a fun, music-
36 | THE ONTARIO DEALER
filled driving experience in mind - it’s the perfect tool for all your future road trips. With Spotify and Waze teaming up, you’ll be able to give every journey its own soundtrack. FIND OUT MORE AT: www.waze.com Garmin introduces an affordable high-tech head-up display. Head-up displays (HUD), originally developed for military fighter jets, are becoming increasingly useful and popular with drivers. They’re able to deliver key information like speed, navigation directions, and more without distracting drivers. The information is generally projected right onto your windshield or onto a separate screen, right in the driver’s line of sight without being distracting or overwhelming. Garmin’s HUD display features a sleek, compact design that projects its
display onto a transparent film that attaches right to your windshield. Garmin’s HUD looks to be one of the most affordable on the market, giving drivers information about speed limits, estimated time of arrival to set destinations, real time navigation, and even the location of hidden speed cameras. The HUD needs to be paired with your smartphone through a Bluetooth connection, able to be paired with iOS’ StreetPilot and Android’s Navigon. The compact design and ease of use means you can easily transfer it between cars, making it useful for just about any purpose. Garmin’s new HUD lets you keep your eyes on the road, while still getting all the information you need as a driver. FIND OUT MORE AT www.garmin.com
THE COMMON LAWYER Sexual Harassment in Ontario’s Dealerships Mary is not satisfied with this response and makes a complaint to the Ministry of Labour. The Ministry conducts an investigation and concludes it by laying charges against the dealership and the dealer principal for fostering a poisoned work environment. The dealership is ultimately fined $25,000. Mary also commences a civil suit claiming $250,000 in damages.
By Justin M. Jakubiak the weekend has come to an end, and Mary, your lead receptionist, is ready to get a start on the busy week ahead. Shortly after being dropped off by her husband and four children, she is asked by James, her supervisor: “When is the last time you got any? You have four kids, you must really enjoy sex!” Mary ignores James and proceeds to hang her jacket and place her lunch in the fridge when, for the sixth time this month, she feels James touching her buttocks. Mary decides not to report this unwanted touching to management. She knows from past experience it will be quickly downplayed as harmless office banter. The next day Mary arrives at her desk to find a lewd note with what looks like pubic hair. Hitting a breaking point, Mary makes a complaint to management. Management fails to conduct an investigation, as is required by law, and tells Mary to lighten up, “boys will be boys.”
Dealers who ignore their legal obligations risk various forms of legal liability. Such liability includes: 1. Significant fines of up to $25,000 for an individual, and $500,000 for a corporation, for failing to comply with the statutory requirements of the Occupational Health and Safety Act and other provincial legislation; and,
The above is made up of real life examples of the types of sexual harassment that takes place in some dealerships and businesses throughout Ontario. Harassment is suffered by both men and woman and may often start out casually; often dismissed as friendly workplace banter. However, it can quickly turn ugly and can severely impact employee morale, your reputation and your pocketbook.
2. Civil lawsuits by sexual harassment victims against the dealer, the perpetrator of the harassment, the dealer principal and possibly other supervisors/ managers.
Should you Worry? What are the chances this could happen to you…
In today’s rapidly evolving economy, dealers are fighting more than ever to stay competitive and manage costs wherever possible. Shouldering the costs of not taking sexual harassment claims seriously is something most dealers cannot afford to do. Every worker, customer, and stranger has the right to equal and fair treatment when they enter your dealership regardless if they are purchasing a brand new vehicle or simply using the washroom. The same standard of treatment must be shown to both. By allowing any form of harassment to persist and eventually become the norm, dealers run the risk of exposing customers to a toxic work environment and losing potential sales and referrals.
In addition, there is a real risk that dealers who permit a poisoned environment to persist will grapple with increased rates of employee absenteeism and decreased work productivity.
High. The Ontario government and the Human Rights Commission have taken strong stances against workplace sexual harassment. This is evident in the government’s recent enactment of the Sexual Violence and Action Plan Act (the “Act”), which came into force on September 26, 2016. Among other things, the Act makes it clear that employers must investigate and address all complaints of workplace harassment as soon as possible. In the last few years alone, there has been several dealers who have refused to meet their obligations, and as a result, were ordered to pay fines ranging from $8,000 to $25,000. For the purposes of
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this article, we need only to consider three recent examples to understand the seriousness of this issue: 1. SMITH V. [DEALER NAME REDACTED] In this case, the dealer was ordered to pay Smith, a former worker, damages in the amount of $25,000. The dealer had allowed a co-worker to engage in the following behaviour and dismissed it as “just fun… [and] horseplay”: • Exposing himself to Smith on numerous occasions while simultaneously “thrusting and gyrating his hips”; • Watching pornography during working hours and allowing “loud grunting noises... to be heard coming from [his] desk”. This sound was so loud that it angered customers and resulted in many leaving the dealership in disgust; and • Leaving a bottle full of urine on Smith’s desk and labelling it as a gift. In this case, although it was the coworker who engaged in the misconduct, the dealer was held to be fully liable for all of Smith’s damages. 2. GUBRENKO V. [DEALER] - In this case, a co-owner of the dealer was ordered to pay a former employee, Ms. Gubrenko,
$2,000 for “informing” Ms. Gubrenko that she owned “nothing in the office but her own “twat”. 3. MITCHELL V. [DEALER] – The applicant, and 6 other female receptionists, complained to the dealer’s management that they were sexually harassed on a consistent basis by the sales manager. This harassment included: • The Sales Manager asking the applicant if she wanted to sit on his lap; • Asking the applicant if the “K” on her necklace referred to the word cleavage; and, • Asking the applicant what she would do to receive a raise. The Dealer was ordered to pay the applicant $10,000. It should be noted that the offending conduct occurred despite the dealer having a robust workplace harassment policy in place. Clearly it is not enough to just have a policy in place, but the Dealer must be prepared to train its staff on the policy and to enforce it. What to do? • Get advice and develop a comprehensive workplace violence and harassment policy • Provide training on how to identify
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38 | THE ONTARIO DEALER
and prevent sexual harassment in the workplace • Outline what steps need to be taken to file a complaint • Be proactive and investigate all complaints thoroughly and quickly • Be aware that sexual harassment can be initiated by someone who is external to the workplace and who may not be an actual employee • Regularly revisit, and revise when needed, your policy and program to ensure that all sections are up-todate Conclusion All parties lose when acts of sexual harassment occur. However, as the employer, the dealer will automatically shoulder most of the consequences. From a bad name to a poisoned work environment, making the decision not to address harassment claims swiftly will likely cost you significantly in the long run. A well-organized and thought out workplace violence and harassment policy will reap several benefits, including happy employees and clients.
ALL-IN PRICE ADVERTISING It’s putting the fun and excitement back into car-buying … and, IT’S THE LAW.
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THE OLD CAR DETECTIVE
MAN WAITS NEARLY 60 YEARS TO BUY 1958 CADILLAC! By Bill Sherk
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an email arrived from bob crocker of tillsonburg, ontario: “Hi Bill. This story begins ‘way back in 1957 when, at the age of 19, I decided to motor down to the CNE Automotive Building to see the Golden Jubilee General Motors Motorama of 1958!
General Motors would build for 1958, their 50th anniversary year! To this day, I can still visualize that moment.
“One of the cars I fell in love with was a ’58 Cadillac Coupe de Ville. It was a medium blue with a white top and chrome trim splashed all over it. Well, “When I walked into the Motorama,” in July 2016, when I was surfing the recalls Bob, “my eyes could not believe internet, an ad popped up with a picture what they were seeing! All the beautiful and there it was, a Blue and White 1958 cars (and girls) were everywhere! The Caddie. Right away I logged in to see spectacular colours and shiny chrome more of the ad with more pictures and on just about every make and model that a nice write-up on the car, and best of
all, it was located in Burlington, Ontario, not far away from Tillsonburg.
about $6800, which in 1958 was a lot of money.
“The asking price for me was way too high, so I did not pursue it. Later that summer, I saw it was still for sale but now with a much lower asking price! I still thought the price was too high but again in September, I logged into the ad once more, and the Caddie was still for sale, this time at a price I could afford.
“The car is Model 6239K. It had two packages which are shown on the option factory price list: Basic Group A at $499.75 and Equipment Group at $66.40. It also has power windows, which is option code X at $142.10. If you add these figures to the base price of $6,234, it comes to around $6,800.”
“A quick phone call was made and an appointment to see and drive the car was all that was needed for it to be purchased and be a garage mate with my 1958 Pontiac Parisienne. So I now own two cars that I saw back in 1957 that I secretly said, one day I would own. It took almost sixty years but I finally found my Blue and White 1958 Cadillac.”
The car was owned by the same family for 15 years, then put into storage for another 30 years. It was finally put up for sale in 2003.
This Cadillac was purchased new on April 24, 1958 by a successful businessman and sold new by St. Remy Motors Service Ltd. in Kingston, Ontario. The owner’s 1958 Cadillac Dealer Identification Card is still in the car, a Series 62 four-door hardtop that cost
The new owner soon realized that the car now required a major restoration. Eight years later, the car was put back on the road in 2011 after a hibernation of 38 years. Due to other projects, the owner decided to sell it in 2016. This beautiful car has a documented mileage of only 62,400 miles and is now driven to local car shows and cruise nights by its current owners, Bob and Carol Crocker of Tillsonburg, Ontario.
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USED VEHICLE LEASING | DAN CROUTCH
USED VEHICLE LEASING By Dan Croutch
REVISITING USED CAR LEASING
leasing is a term commonly associated with new cars. It’s a common tool to help a customer’s money go further. Leasing may be a great tool to attract and increase revenue, or expand the type of products on offer to customers. Does it work Leasing isn’t a new concept. New car dealers have leasing programs through manufacturers, and have been offering them for decades. However, leasing used cars has a unique risk, when compared to new cars. Because some of the value in a used vehicle has been lost to depreciation, dealers could face the risk that they may be left upside down on a returned lease car.
42 | THE ONTARIO DEALER
Worse still, age and mileage may make the car difficult to sell, even with aggressive financing. Sales numbers for new and used cars, according to Experian Automotive, showed a 31% increase in leasing for the last quarter of 2016. This is a trend which is only growing. It’s a reflection of the shift in how consumers, particularly younger buyers, are approaching car ownership. According to a study done in 2016 by the EFG Companies, nearly a quarter of responders said they were planning on leasing in the next year, with another four percent within the next five years. While nearly 30% of buyers are open to leasing, it leaves over 70% who aren’t. As dealers, the challenge is to overcome the biggest opposition these buyers have to leasing.
Often, they’re misconceptions which may have been given to them from a third party. Or, buyers will be armed with information, or mis-information, found online. The responses can be summarized into three points, accounting for nearly all the responses. Buyers were most concerned that leasing doesn’t give them ownership for vehicles at the end of the term. Fees associated with mileage and wear and tear was second. Rounding out the list is the traditional perception that leasing is simply more expensive. With more than 70% of customers on the fence about leasing, there is a big opportunity for dealers to increase volume by driving leasing as an option. The most effective tool for increasing lease volume is an educated sales staff. Training provides staff with the customer’s most likely aversions to leasing, and how to address them. Access, not ownership There is a shift in how consumers perceive ownership, particularly among younger ones. Subscription based streaming services have gone from the fringes to become the norm. Media ownership is defined by monthly fees,
not physical ownership. By extension, younger consumers are more receptive to non-ownership like leasing. Leasing gives them access to a vehicle, for a lower monthly payment, without the risks of ownership. It’s a lot like their favourite streaming services. Further evidence of this shift in ownership perspective is coming from progressive companies like Tesla. Many so-called “disruptors” tout an alternative form of ownership, where users pay a monthly fee to access a car: Essentially leasing. This change in mindset presents an opportunity for dealers to tap into and overcome the biggest thing consumers say keeps them from leasing: No vehicle ownership at the end of the lease. It costs more Cost is a big factor for car buyers in the used car market. Two of the three things buyers said keep them from leasing are cost related. A general perception that leases are more expensive, driven by penalties associated with mileage or wear, keep buyers from leasing. Many of these buyers are well researched, or have some understanding of what online research says about leasing. Sales staff can use a handful of lifestyle questions to quickly help a consumer overcome cost perceptions. Consider asking a customer
their commute or driving habits, annual mileage, ownership or trade-in habits. Show buyers how leasing is only paying for the use they get out of the vehicle. Some buyers may be looking at a used vehicle to avoid depreciation costs. These buyers will be interested to learn how leasing can protect them from value depreciation. This includes market risks which can drastically change the value of their car. If buyers know they have protection from going “upside down” on their car loan, leasing becomes a very attractive option. With new car interest rates at historical lows, and financing terms the longest they’ve ever been, leasing may not be as competitive to buyers hoping to lower monthly payments. Even loan terms for used cars now stretch well beyond 60 months. But, some buyers may be averse to these long-term loans. Leasing provides an opportunity for these buyers to reduce monthly payments without a long-term loan. Budget sensitive buyers will be attracted to leases which offer the same payments as long term loans, without the commitment. You can offer leasing as an alternative to buyers looking to lower their monthly costs.
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USED VEHICLE LEASING | DAN CROUTCH
Customers today are more cost conscious than ever before. However, they’re more receptive to alternatives to financing as well. Customers today are more cost conscious than ever before. However, they’re more receptive to alternative forms of financing as well. Leasing used cars allows customers to feel more empowered. Potential for lower monthly payments gives customers incentive to buy. Or, they can use their budget to buy more. Lease payments look better on paper to a customer, without a long-term commitment. Used vehicles can present a unique concern for buyers. Consumers may be wary of out-of-warranty repairs when leasing a second vehicle. Show buyers how out of warranty repairs are a cost they will have regardless if they lease or purchase. Consider offering late model inventory for buyers, with the balance of the OEM warranty, to address their fears. Including third party warranty coverage, standard practice for many, with other inventory vehicles also addresses this concern. Get Social Some of the best tools to get information about leasing to customers is free to dealers. Customers, particularly younger ones, look to the internet first for information. Social media is a resource every dealer should be using to attract leads. It can also be a great tool to prime customers with information about leasing before they even set foot on the lot.
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Use tools like Facebook and Twitter to share short facts about leasing. Customers using these platforms cover a broad spectrum of demographics, so keep it general but informative. Social voice should be one that teaches, not talks down to. Highlight an item from inventory, then tell customers how leasing can get it in their driveway for less. YouTube has become a significant resource for how-to videos. Buyers seem more interested in watching a video about content than reading an article. Again, while YouTube should already be a source of lead generation, it’s a great tool to create short, fun videos about leasing. Use this opportunity for sales staff to put into practice lease selling tactics. Keep it light, but reflective of the experience a buyer would have at your retail location. Arming your customers with reasons to lease before they arrive puts them on your side, effectively eliminating their concerns about leasing. A cursory search on Google returns a handful of dealers offering leasing to customers. Use SEO to make sure your dealership comes out on top. Websites should also provide a simple FAQ about leasing. Taking these steps helps elevate your business to the top of searches. Overcoming Internal Challenges The challenge for dealers is keeping an inventory which presents the lowest
risk. Currently, exotic cars are the most common type of used vehicle being leased. Low to no depreciation and high demand easily lowers the risks relating to leasing. However, this doesn’t mean leasing should be exclusive to exotics. For the risk averse, consider a focus on high quality, low mileage inventory as the best defense. Off-rental vehicles are priced aggressively, often taking nearly all of the depreciation out of a vehicle. Dealer-off lease, whether internally or through auction, can also provide a source for lower mileage, well maintained second-hand vehicles. Again, it may not be necessary to spend time and effort on the best used lease inventory. You’re likely sitting on a lot full. Leasing: boosting your bottom line In summary, the industry continues to see an increase in customers choosing to lease with their used vehicle. Thanks to a pay-to-access movement in other industries, leasing is now an attractive option to many new customers. By understanding customers, and their concerns, sales staff can help their customers better understand how leasing is right for them. With sufficient investment, leasing could become a strong bolster to bottom line, without replacing vehicle inventory.
USED CAR DEALERS ASSOCATION OF ONTARIO launching Ontariocars.ca access to all the useful features boasted by the website. the used car dealers association of ontario is pleased to introduce Ontariocars.ca, a new website that promises to benefit both members of the UCDA and consumers looking for an ideal used car buying experience. Warren Barnard, Executive Director of the UCDA, had a lot to share about the exciting new project, which is set to go live in November 2017.
About the website Ontariocars.ca is a brand new and unique way for Ontario dealerships to list their new and used cars for sale to consumers. Only dealers who are members of the UCDA can list their vehicles on the website - this ensures that every listing is verified as being legitimate.
body styles, made easy for consumers of any experience level with the help of stylish graphics. Listings are searchable by proximity, year, make, model, and price range among other criteria. Consumers can also use the â€œFind a Dealerâ€? feature, which shows UCDA member dealers in every community, with information provided about where to find these dealerships, contact information, and links to their websites and inventory. This is a feature unique to Ontariocars.ca, and will easily help to direct physical and web traffic to individual dealerships featured on the website.
The website has been made with members in mind - the goal being to help UCDA members generate leads at an affordable listing price. Ontariocars.ca is available to all UCDA members.
The website is the only one on the market to feature up front all-in pricing on all vehicles. With Ontariocars.ca, what you see is the price you pay (plus tax and licencing and any optional features purchased), taking away the possibility for hidden fees.
A safer, more reliable used car buying experience
Members will be able to list their vehicles for free until the end of February, 2018. This free trial allows for unlimited listings during the 3-month trial period, and
Vehicles are listed in a variety of ways, all customizable and easy to navigate for dealers and consumers. One of the unique ways to search for vehicles is by popular
Listing and purchasing used cars online can be a frustrating and challenging experience for dealers and consumers, especially with the threat of fraud from
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curbsiders. Curbsiders are those who pose as private sellers, but are actually looking to illegally sell vehicles - this has become a major problem because there are no consumer protections in place when buying from curbsiders. With Ontariocars.ca, there’s no more worrying about curbsiders because every listing is from a registered dealer.
• Vehicles are presented honestly and all important facts are disclosed
Looking to the future: launching with marketing campaign
• Consumers have an accurate understanding of all products and services being offered to them
As mentioned previously, listing prices are all in so that users know the price they see is the price they get. On top of this, all important facts about the vehicle and its history will be disclosed - including accident disclosure, and special or unusual past use. The listings are also certified lien free, assuring consumers that any vehicle listed on the website is free of any previous loans.
• All promises will be delivered
Maintaining ease of use is of the utmost importance to the website creators, as it will make listing vehicles a painless, consistent experience. “The website has been designed with our members in mind - we wanted to make it easier for all members to post listings and generate leads, and it’s finally here” says Barnard.
The ability for prospective buyers to find dealerships and listings close to their locations is imperative, as it saves consumers from being forced to travel long distances or go out of their way simply because they weren’t aware of the listings in their area. Having all the vehicle information beforehand means that buyers will know exactly what they are getting into with each vehicle purchase, and will make for a smoother transaction for both consumers and the dealer. Consumer protection Ontariocars.ca is dedicated to giving consumers and dealers the best experience possible, and safety is the their top priority. Any customer purchasing a vehicle listed on the website will be protected by the Motor Vehicle Dealers Compensation Fund administered by the Ontario Motor Vehicle Industry Council (OMVIC). The Compensation Fund covers up to $45,000 per vehicle transaction, and claims can be submitted within two years of purchase. On top of the Compensation Fund, dealers listing on the website will adhere to the UCDA’s Code of Ethics, which states that:
46 | THE ONTARIO DEALER
• No prior loans are outstanding on the vehicles
• Complaints will be dealt with promptly • Will contribute to a Consumer Compensation Fund for consumer protection Benefitting UCDA members and consumers Ontariocars.ca has been in development for more than a year and a half, developed with care as a one-stop shop with UCDA members and customers in mind. The design of the website is extremely easy to navigate for users of all experience levels. Getting rid of the needless clutter of automotive listing websites was one of the main reasons for the new site’s development - instead focusing on the most pertinent information for consumers to make educated purchasing decisions. One of the unique features offered by the website is that dealers can request their listings to be syndicated to or from other vehicle listing sites. This allows dealers to cover all bases to ensure that their listings gain traction and achieve maximum exposure. Ontariocars.ca will compliment other sites with these syndicated listings. The website will not contain any thirdparty advertisements, which is another feature that sets Ontariocars.ca apart from other sites. These ads are often intrusive and have nothing to do with the vehicles being browsed by consumers - and may take potential customers away from the website, or from the vehicle they had been viewing.
Dealerships are taking advantage of online listings more and more, and Barnard hopes that the creation of the website will help to motivate some of the more traditional UCDA members to explore their options online. An extensive social media marketing campaign has been developed to coincide with the official launch of the website, with contests being planned in the new year for Facebook, Twitter, Instagram, and all other major social media hubs. Prizes will range from items like car mats and stereos to the opportunity to drive luxury sports cars on a professional racetrack. The campaign will drive buyers to the website, where they will be met with a sleek and easy-to-navigate used car listing site that suits their needs as consumers. In future updates, Barnard expects that the website will feature more tools for consumers to find financing for their vehicle needs from the comfort of their homes. Another plan is to give UCDA dealers the ability to develop their own websites using basic and inexpensive tools provided by the site. “We think the benefits of using the website are going to be self-evident, and that dealers will be able to generate leads and see a significant increase in sales” says Barnard. UCDA members will now be able to take advantage of the versatile new website with a free three month trial featuring unlimited listings running through to the end of February 2018. The website is set to launch to the public in November at
Your Site ... Your Cars! HOME | USED CARS | NEW CARS | FIND A DEALER | ABOUT US
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Set up your FREE Account at ucdasearches.com 1-800-268-2598
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