NADA Convention in Orlando: The 30,000-Foot View

– Per­spec­tives of J. H. Thomp­son, Assis­tant Edi­tor, Auto­mo­tive Digest


  • U.S. mar­ket will be over 15M due to pent up demand, an aging car park and the increased num­ber of vehi­cle intro­duc­tions.
  • Improved hous­ing mar­ket is dri­ving con­sumer con­fi­dence.
  • Lenders have learned con­sumers will pay their auto loan before their home mort­gage or cred­it card bal­ances; lead­ing to relaxed lend­ing rules for car buy­ers.
  • Used car prices will remain above aver­age; sale vol­ume will remain strong despite low inven­to­ries.
  • Used car sales will be buoyed by three-year old lease returns com­ing back to the mar­ket.
  • Sales in Europe will con­tin­ue to decline (bad news for Ford and, par­tic­u­lar­ly, GM – my opin­ion).
  • Chi­na and the emerg­ing mar­kets will see explod­ing sales growth. They do have issues: deal­er net­work, nation­al tax poli­cies and local infra­struc­ture.


  • Lexus is back on top, but it will take time to regain sales lead­er­ship.
  • Ford and GM are in good shape.
  • Toy­ota has ful­ly recov­ered for the tsuna­mi. Hon­da is in good shape, but has a way to go main­ly due to poor­ly launched Civic and cus­tomer expe­ri­ence.
  • Chrysler has seri­ous issues; ques­tions remain about how suc­cess­ful they will be long term.
  • Mit­subishi has seri­ous issues; its via­bil­i­ty is in doubt.
  • Mer­cedes plans to chal­lenge the mar­ket with a sub-$30K entry.
  • “The cus­tomer expe­ri­ence” is the hot but­ton issue.


  • Most deal­ers used the reces­sion wise­ly; con­trol­ling expens­es and improv­ing F&I, used car oper­a­tions and parts & ser­vice to remain prof­itable.
  • Deal­ers are expect­ing strong sales and prof­its in 2013.
  • The increase is sales vol­ume offers a dilem­ma: keep over­head low at the expense of sales or return to prac­tices of the past to sell more cars.
  • Fran­chise brand improve­ment pro­grams went too far; strict adher­ence to a cook­ie cut­ter look can­not be jus­ti­fied.
  • Deal­ers push­ing back on Objec­tive Based Sales Incen­tives; caus­es exces­sive con­sumer shop­ping.
  • Social media will dri­ve future sales suc­cess includ­ing efforts at rep­u­ta­tion pro­tec­tion; deal­ers who do not hear this mes­sage will strug­gle.
  • The num­ber of deal­ers will not increase sig­nif­i­cant­ly.
  • Deal­ers seem uncon­cerned about growth of orga­ni­za­tions like Auto­Na­tion.
  • Deal­ers face issues regard­ing tax­es, employ­ee health insur­ance, cus­tomer pri­va­cy, and increase scruti­ny by Fed­er­al Trade Com­mis­sion.


  • The Cloud is the word; offers easy imple­men­ta­tion, up to date com­put­er appli­ca­tions, menu shop­ping for appli­ca­tion and sys­tem secu­ri­ty.
  • Focus on cus­tomer expe­ri­ence to mir­ror focus of automak­ers.
  • The cus­tomer expe­ri­ence often cen­ters on the abil­i­ty to com­mu­ni­cate with cus­tomers with a con­cen­tra­tion on the emerg­ing buy­ers of Gen Y.
  • Too many ven­dors offer the same ser­vices, look for con­sol­i­da­tion; deal­ers want a sin­gle source for DMS, social media mar­ket­ing and rep­u­ta­tion pro­tec­tion. (Author’s opin­ion)
  • Big Data is impor­tant, but only if you know how to ana­lyze it and put actions in place to take advan­tage of the results.


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