No shortage of used cars

March 10, 2009

I’ve been in California for the last 2 days and having gone from coast to coast in the past 4 days I’m more convinced than ever that there’s no shortage of used cars. Just to be clear, everybody is complaining about the lack of used cars. Although I’ve previously written about this subject, I feel compelled to restate my view.

There are plenty of used cars, the problem is that you have to go out and get them, they’re no longer arriving by the convenience of a customer trade in. The pain being experienced by dealers is not the shortage of metal, but rather the shortage of expertise and time to find it. The title of “Used Car Manager” does not necessarily qualify someone as a “buyer”.

A true buyer spends at least 80% of their time on buying activities. Such activities include many hours per week researching run lists and values, traveling by car and plane, standing in lanes for hours, auction office check out lines, transport logistics, going to bed and doing it all over again the next day. There just aren’t too many guys and gals where these tasks are the primary responsibilities of their professional lives. If your dealership can’t say that you have this person, then you are probably one of those that think there is a shortage of cars.

To make matters worse, the perception of a shortage invites ill-advised relaxation of sound discipline. Dealers that perceive a shortage of cars are saying things such as:

• I can’t replace it for what I own it for
• We have to make more on the ones we’ve got
• A strict turn policy doesn’t make sense right now
• And many other such ridiculous statements

If you’re falling into these traps, catch yourself and realize the root problem. It is most likely the fact that you’re not equipped as a professional buying organization.